On January 1, 2017, Bridgeport Company purchased 9% bonds havinga maturity value of $330,000, for $357,062.64. The bonds providethe bondholders with a 7% yield. They are dated January 1, 2017,and mature January 1, 2022, with interest receivable January 1 ofeach year. Bridgeport Company uses the effective-interest method toallocate unamortized discount or premium. The bonds are classifiedin the held-to-maturity category.
a)Prepare the journal entry at the date of the bond purchase.(Enter answers to 2 decimal places, e.g.2,525.25. Credit account titles areautomatically indented when amount is entered. Do not indentmanually. If no entry is required, select "No Entry" for theaccount titles and enter 0 for the amounts.)
b)Prepare a bond amortization schedule. (Roundanswers to 2 decimal places, e.g. 2,525.25.)
c)Prepare the journal entry to record the interest revenue andthe amortization at December 31, 2017. (Round answersto 2 decimal places, e.g. 2,525.25. Credit account titles areautomatically indented when amount is entered. Do not indentmanually. If no entry is required, select "No Entry" for theaccount titles and enter 0 for the amounts.)
On January 1, 2017, Bridgeport Company purchased 9% bonds havinga maturity value of $330,000, for $357,062.64. The bonds providethe bondholders with a 7% yield. They are dated January 1, 2017,and mature January 1, 2022, with interest receivable January 1 ofeach year. Bridgeport Company uses the effective-interest method toallocate unamortized discount or premium. The bonds are classifiedin the held-to-maturity category.
a)Prepare the journal entry at the date of the bond purchase.(Enter answers to 2 decimal places, e.g.2,525.25. Credit account titles areautomatically indented when amount is entered. Do not indentmanually. If no entry is required, select "No Entry" for theaccount titles and enter 0 for the amounts.)
b)Prepare a bond amortization schedule. (Roundanswers to 2 decimal places, e.g. 2,525.25.)
c)Prepare the journal entry to record the interest revenue andthe amortization at December 31, 2017. (Round answersto 2 decimal places, e.g. 2,525.25. Credit account titles areautomatically indented when amount is entered. Do not indentmanually. If no entry is required, select "No Entry" for theaccount titles and enter 0 for the amounts.)
