Presented below is the partial bond discount amortization schedule for Syam Corp., which uses the effective-interest method of amortization.
Use effective-interest method of bond amortization.
|
Interest Periods
|
Interest to Be Paid
|
Interest Expense to Be Recorded
|
Discount Amortization
|
Unamortized Discount
|
Bond Carrying Value
|
|
Issue date
|
$38,609
|
$961,391
|
|
1
|
$45,000
|
$48,070
|
$3,070
|
35,539
|
964,461
|
|
2
|
45,000
|
48,223
|
3,223
|
32,316
|
967,684
|
1. Give the stated interest rate
2. Give the market interest rate
3. Give the selling price of bonds as a percent of face value
4. Give journal entry to record the sale of bonds
5. Give 1 entry to record interest expense after 6 months.