Question

  
Problem 14-5
In each of the following independent cases, the company closes its books on December 31.

  
Whispering Co. sells $497,000 of 8% bonds on March 1, 2017. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2020. The bonds yield 12%.

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
3/1/17       $ $ $ $

9/1/17      

3/1/18      

9/1/18      

3/1/19      

9/1/19      

3/1/20      

9/1/20      

Prepare all of the relevant journal entries from the time of sale until the date indicated. (Assume that no reversing entries were made.)

Answer 1