AC 302 CHAPTER 14 QUESTION 5

AC 302 CHAPTER 14 QUESTION 5
Name				Date		
Instructor				Course		
Intermediate Accounting 14th Edition by Kieso Weygandt and Warfield						
Primer on Using Excel in Accounting by Rex A Schildhouse						
						
Foreman Company issued		$800,000 	of	10%	20 	year bonds on
January 1, 2013 at		102 	Interest is payable semiannually on July 1 and January 1.			
Foreman Company uses the effective interest method of amortization for bond premium or discount.						
Assume an effective yield of		9.7705%				
Instructions:						
Prepare the journal entries to record the following. (Round to the nearest dollar.)						
(a) The issuance of the bonds.						
						
Jan 1, 13	Account Title				Formula	
	Account Title					Amount
	Account Title					Amount
						
(b) The payment of interest and related amortization on July 1, 2013.						
						
Jul 1, 13	Account Title				Formula	
	Account Title				Formula	
	Account Title					Formula
						
(c) The accrual of interest and the related amortization on December 31, 2013.						
						
Dec 31, 13	Account Title				Formula	
	Account Title				Formula	
	Account Title					Formula
						
	Carrying amount of bonds at July 1, 2013:					
	Text title				Formula	
	Text title				Formula	
	Text title				Formula