(a) Pharoah Co. sold $2,080,000 of 12%, 10-year bonds at 102 on January 1, 2020. The bonds were dated January 1, 2020, and pay interest on July 1 and January 1. If Pharoah uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2020, and December 31, 2020. (Round answer to 0 decimal places, e.g. 38,548.) Interest expense to be recorded $ (b) Novak Inc. issued $650,000 of 9%, 10-year bonds on June 30, 2020, for $538,165. This price provided a yield of 12% on the bonds. Interest is payable semiannually on December 31 and June 30. If Novak uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2020. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548.) Interest expense to be recorded $

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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(a) Pharoah Co. sold $2,080,000 of 12%, 10-year bonds at 102 on January 1, 2020. The bonds were dated January 1, 2020, and pay
interest on July 1 and January 1. If Pharoah uses the straight-line method to amortize bond premium or discount, determine the
amount of interest expense to be reported on July 1, 2020, and December 31, 2020. (Round answer to 0 decimal places, e.g.
38,548.)
Interest expense to be recorded $
(b) Novak Inc. issued $650,000 of 9%, 10-year bonds on June 30, 2020, for $538,165. This price provided a yield of 12% on the bonds.
Interest is payable semiannually on December 31 and June 30. If Novak uses the effective-interest method, determine the amount of
interest expense to record if financial statements are issued on October 31, 2020. (Round intermediate calculations to 6 decimal
places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548.)
Interest expense to be recorded $
Transcribed Image Text:(a) Pharoah Co. sold $2,080,000 of 12%, 10-year bonds at 102 on January 1, 2020. The bonds were dated January 1, 2020, and pay interest on July 1 and January 1. If Pharoah uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2020, and December 31, 2020. (Round answer to 0 decimal places, e.g. 38,548.) Interest expense to be recorded $ (b) Novak Inc. issued $650,000 of 9%, 10-year bonds on June 30, 2020, for $538,165. This price provided a yield of 12% on the bonds. Interest is payable semiannually on December 31 and June 30. If Novak uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2020. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548.) Interest expense to be recorded $
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