80.2K

Verified Solution

Link Copied!

On January 1,2020, Blossom Industries Ltd. issued 1,850,000 face value, 5%,10-year bonds at 1,713,838. This price resulted in an effective-interest rate of 6% on the bonds. Blossom uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1. 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Prepare an amortization table through December 31, 2022 (three interest periods) for this bond issue. (Round answers to 0 lecimal places, e.g. 15,250.) Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31,2020 , (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Prepare the journal entry to record the payment of interest on January 1, 2021. (Round answers to 0 decimal places, e.8. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2021. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Answer & Explanation Solved by verified expert

See Answer