On January 1, 2020, Sweet Company purchased  12% bonds having a maturity value of $ 270,000, for $ 290,470.00. The bonds provide the bondholders with a  10% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Sweet Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of the bond purchase   Prepare a bond amortization schedule.   Prepare the journal entry to record the interest revenue and the amortization at December 31, 2020.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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On January 1, 2020, Sweet Company purchased  12% bonds having a maturity value of $ 270,000, for $ 290,470.00. The bonds provide the bondholders with a  10% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Sweet Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category.

Prepare the journal entry at the date of the bond purchase

 
Prepare a bond amortization schedule.
 
Prepare the journal entry to record the interest revenue and the amortization at December 31, 2020.
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