View PoliciesCurrent Attempt in ProgressOn January 1, 2020, Aumont Company sold 12% bonds having a maturity value of $ 500,000 for $ 537,907, which provides thebondholders with a 10% yield. The bonds are dated January 1, 2020, and mature January 1, 2025, with interest payable December 31of each year. Aumont Company allocates interest and unamortized disCount or premium on the effective-interest basis.(a) Prepare the journal entry at the date of the bond issuance. (Round answer to 0 decimal places, e.g. 38,548. If no entry is required,select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount isentered. Do not indent manually.)DateAccount Titles and ExplanationDebitCreditJanuary 1,2020

Solution: Computation of bond price Table values are based on: n= 5 i= 10.00%…

Answered: On January 1, 2020, Aumont Company sold…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On July 1, 2019, Waterway Industries issued 11% bonds in the face amount of $12500000, which mature on July 1, 2025. The bonds were issued for $11986074 to yield 12%, resulting in a bond discount of $513926. Waterway uses the effective-interest method of amortizing bond discount. Interest is payable annually on June 30. At June 30, 2021, Waterway's unamortized bond discount should be (Round intermediate calculations to 0 decimal places, e.g. 9,020,890.) $409269. $379669. $367269. $397269.
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