On January 1, 2020, Concord Corporation purchased a newly issued $1,225,000 bond. The bond matured on December 31, 2022, and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Concord’s fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date. The bond will be accounted using the amortized cost model.
Calculate the price paid for the bond using a financial calculator or Excel functions. (Round answers to 2 decimal places, e.g. 52.75.)
| PV | $ |
Prepare an amortization schedule for the bond. (Round answers to 2 decimal places, e.g. 52.75.)
Prepare the journal entries on the books of Concord Corporation
for each of the following dates. (Round answers to 2
decimal places, e.g. 52.75. Credit account titles are automatically
indented when the amount is entered. Do not indent manually. If no
entry is required, select "No Entry" for the account titles and
enter 0 for the amounts.)
| ● | January 1, 2020 | |
| ● | June 30, 2020 | |
| ● | October 31, 2020 | |
| ● | December 31, 2020 | |
| ● |
December 31, 2022 (two entries) one for interest and one for maturity of bond |
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