Cole Corporation issued $400,000, 7%, 20-year bonds on January 1, 2014, for $360,727. This price resulted in an effective-interest rate of 8% on the bonds. Interest is payable annually on January 1. Cole uses the effective-interest method to amortize bond premium or discount.
Prepare the schedule using effective-interest method to amortize bond premium or discount of Cole Corporation.(Round answers to 0 decimal places, e.g. 125.)
|
Interest
Periods
|
|
Interest to
Be Paid
|
|
Interest Expense
to Be Recorded
|
|
Discount
Amortization
|
|
Unamortized
Discount
|
|
Bond
Carrying Value
|
|
Issue date
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
Prepare the journal entries to record the issuance of the bonds. (Round answers to 0 decimal places, e.g. 125.) -Jan. 1, 2014
Prepare the journal entries to record the accrual of interest and the discount amortization on December 31, 2014.(Round answers to 0 decimal places, e.g. 125.)
Prepare the journal entries to record the payment of interest on January 1, 2015. (Round answers to 0 decimal places, e.g. 125.)