Problem 14-05 (Part Level Submission) In each of the following independent cases, the company closes its books on December 31. v (a) Headland Co. sells $497,000 of 8% bonds on March 1, 2020. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2023. The bonds yield 12%. Give entries through December 31, 2021. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to 0 decimal places, e.g. 38,548.) Schedule of Bond Discount Amortization Effective-Interest Method Bonds Sold to Yield Discount Amortized Carrying Amount of Bonds Cash Interest Date Paid Expense 3/1/20 9/1/20 3/1/21 9/1/21 3/1/22 9/1/22 3/1/23 9/1/23
Problem 14-05 (Part Level Submission) In each of the following independent cases, the company closes its books on December 31. v (a) Headland Co. sells $497,000 of 8% bonds on March 1, 2020. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2023. The bonds yield 12%. Give entries through December 31, 2021. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to 0 decimal places, e.g. 38,548.) Schedule of Bond Discount Amortization Effective-Interest Method Bonds Sold to Yield Discount Amortized Carrying Amount of Bonds Cash Interest Date Paid Expense 3/1/20 9/1/20 3/1/21 9/1/21 3/1/22 9/1/22 3/1/23 9/1/23
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![**Problem 14-05 (Part Level Submission)**
In each of the following independent cases, the company closes its books on December 31.
**(a)**
Headland Co. sells $497,000 of 8% bonds on March 1, 2020. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2023. The bonds yield 12%. Give entries through December 31, 2021.
Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. *(Round answers to 0 decimal places, e.g., 38,548.)*
**Schedule of Bond Discount Amortization**
*Effective-Interest Method - Bonds Sold to Yield*
| Date | Cash Paid | Interest Expense | Discount Amortized | Carrying Amount of Bonds |
|-------|-----------|------------------|--------------------|--------------------------|
| 3/1/20| | | | |
| 9/1/20| | | | |
| 3/1/21| | | | |
| 9/1/21| | | | |
| 3/1/22| | | | |
| 9/1/22| | | | |
| 3/1/23| | | | |
| 9/1/23| | | | |
Remove all of the indicated journal entries from the form of codes and decimals at year-end.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F05daa4d9-8c98-40c5-9fac-94c3aa32ce8f%2F3d41c4a1-d688-400c-9a2b-7567ddc38074%2Fp55uoz_processed.png&w=3840&q=75)
Transcribed Image Text:**Problem 14-05 (Part Level Submission)**
In each of the following independent cases, the company closes its books on December 31.
**(a)**
Headland Co. sells $497,000 of 8% bonds on March 1, 2020. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2023. The bonds yield 12%. Give entries through December 31, 2021.
Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. *(Round answers to 0 decimal places, e.g., 38,548.)*
**Schedule of Bond Discount Amortization**
*Effective-Interest Method - Bonds Sold to Yield*
| Date | Cash Paid | Interest Expense | Discount Amortized | Carrying Amount of Bonds |
|-------|-----------|------------------|--------------------|--------------------------|
| 3/1/20| | | | |
| 9/1/20| | | | |
| 3/1/21| | | | |
| 9/1/21| | | | |
| 3/1/22| | | | |
| 9/1/22| | | | |
| 3/1/23| | | | |
| 9/1/23| | | | |
Remove all of the indicated journal entries from the form of codes and decimals at year-end.
![**Journal Entry Preparation**
Prepare all of the relevant journal entries from the time of sale until December 31, 2021. (Assume that no reversing entries were made.)
- **Guidelines**:
- Round present value factor calculations to 5 decimal places (e.g., 1.25124).
- Round final answers to 0 decimal places (e.g., $8,971).
- 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 an amount is entered. Do not indent manually.
**Table for Journal Entries**
| Date | Account Titles and Explanation | Debit | Credit |
|------------|---------------------------------|-------|--------|
| 3/1/20 | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| 3/1/21 | | | |
| | | | |
| | | | |
- Use the dropdown menu to select account titles where applicable.
- Ensure all entries are complete as required by the guidelines.
---
**Notes:**
- This table helps record financial transactions in a systematic manner to ensure accuracy in financial reporting.
- Any entries made should reflect the accounting principles and guidelines provided above.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F05daa4d9-8c98-40c5-9fac-94c3aa32ce8f%2F3d41c4a1-d688-400c-9a2b-7567ddc38074%2F4222u8_processed.png&w=3840&q=75)
Transcribed Image Text:**Journal Entry Preparation**
Prepare all of the relevant journal entries from the time of sale until December 31, 2021. (Assume that no reversing entries were made.)
- **Guidelines**:
- Round present value factor calculations to 5 decimal places (e.g., 1.25124).
- Round final answers to 0 decimal places (e.g., $8,971).
- 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 an amount is entered. Do not indent manually.
**Table for Journal Entries**
| Date | Account Titles and Explanation | Debit | Credit |
|------------|---------------------------------|-------|--------|
| 3/1/20 | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| 3/1/21 | | | |
| | | | |
| | | | |
- Use the dropdown menu to select account titles where applicable.
- Ensure all entries are complete as required by the guidelines.
---
**Notes:**
- This table helps record financial transactions in a systematic manner to ensure accuracy in financial reporting.
- Any entries made should reflect the accounting principles and guidelines provided above.
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