[sheridanz]

1.value:
15 points Problem 14-2A Straight-line amortization of bond discount and bond premium L.O. P1, P2, P3

Braeburn issues $3,000,000 of 8%, 15-year bonds dated January 1, 2009, that pay interest semiannually on June 30 and December 31.

Requirement 1:
Assume that the bonds are issued at a price of $2,592,000.

(a) Prepare the January 1, 2009, journal entry to record the bonds' issuance. (Omit the "$" sign in your response.)

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(b) For each semiannual period, compute the following (Round your answers to the nearest dollar amount. Omit the "$" sign in your response):

Cash payment $
Straight-line discount amortization $
Bond interest expense $

(c) Determine the total bond interest expense to be recognized over the bonds' life. (Omit the "$" sign in your response.)

Total bond interest expense $

(d) Use the straight-line method to amortize the discount for these bonds like the one in Exhibit 10.7. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

Semiannual Period-End Unamortized Discount Carrying
Value
1/01/2009 $ $
6/30/2009
12/31/2009
6/30/2010
12/31/2010

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(e) Prepare the journal entries to record the first two interest payments. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

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Requirement 2:
Assume that the bonds are issued at a price of $3,672,000.

(a) Prepare the January 1, 2009, journal entry to record the bonds' issuance. (Omit the "$" sign in your response.)

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(b) For each semiannual period, compute the following (Round your answers to the nearest dollar amount. Omit the "$" sign in your response):

Cash payment $
Straight-line premium amortization $
Bond interest expense $

(c) Determine the total bond interest expense to be recognized over the bonds' life. (Omit the "$" sign in your response.)

Total bond interest expense $

(d) Use the straight line method to amortize the discount for these bonds like the one in Exhibit 10.7. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

Semiannual Period-End Unamortized Premium Carrying
Value
1/01/2009 $ $
6/30/2009
12/31/2009
6/30/2010
12/31/2010

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(e) Prepare the journal entries to record the first two interest payments. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)



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Check My WorkReferences
Worksheet Problem 14-2A Straight-line amortization of bond discount and bond premium L.O. P1, P2, P3

[Curlyben]

Thank you for taking the time to copy your homework to AMHD.
Please refer to this announcement: https://www.askmehelpdesk.com/financ...-b-u-font.html

[morgaine300]

Thank you for taking the time to copy it twice. I've deleted your duplicate. And I also deleted all those drop-down choices because we don't need them and it'll save scrolling. (I would also suggest doing your work on paper first cause the drop-down menus prevent you from thinking for yourself and therefore don't promote really learning.)

This is an entire chapter's worth of stuff. No one can explain that much to you in a forum posting. And both problems are exactly the same except for one being a premium and one being a discount. If you learn the concept of how to do one, you can do the other.

What attempts have you made? Post them. It's easier to explain where you are going wrong than try to "give hints" on an entire topic area.