Concept introduction:
Bonds: Bonds are debt instruments issued by the borrower company to its lenders. Bonds are issued at a specified rate of interest and for a specified time period. The bondholders get a fixed rate of interest on the bonds and repayment of the bonds at the maturity date.
Amortization of Bonds premium or discount: Bonds may be issued at a premium or discount. The premium or discount on issue of binds is amortized or the life of bonds using the straight line or effective rate methods.
Requirement-1:
To calculate: The Cash proceed from issuance of bonds
Requirement-2:
To Prepare: The Amortization table for bonds payable using the effective interest rate method
Requirement-3:
To Prepare: The
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ACCOUNTING PRINCIPLES 122 5/16 >C<
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