Entries for Issuing Bonds and Amortizing Premium by Straight-Line Method Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $3,200,000 of 6-year, 12% bonds at a market (effective) interest rate of 11%, receiving cash of $3,337,898. Interest is payable semiannually on April 1 and October 1. b. Journalize the entry to record the first interest payment on October 1, 20Y1, and amortization of bond premium for six months, using the straight-line method. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.
Entries for Issuing Bonds and Amortizing Premium by Straight-Line Method Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $3,200,000 of 6-year, 12% bonds at a market (effective) interest rate of 11%, receiving cash of $3,337,898. Interest is payable semiannually on April 1 and October 1. b. Journalize the entry to record the first interest payment on October 1, 20Y1, and amortization of bond premium for six months, using the straight-line method. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Entries for Issuing Bonds and Amortizing Premium by Straight-Line Method
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $3,200,000 of 6-year, 12% bonds at a market (effective) interest rate of 11%, receiving cash of $3,337,898. Interest is payable semiannually on April 1 and October 1.
b.
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