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The following amortization and interest schedule is for the issuance of 10-year bonds by Marigold Corporation...

The following amortization and interest schedule is for the issuance of 10-year bonds by Marigold Corporation on January 1, 2020, and the subsequent interest payments and charges. The company’s year end is December 31 and it prepares its financial statements yearly.

Amortization Schedule
Amount Carrying
Year Cash Interest Unamortized Amount
Jan. 1, 2020 $5,961 $91,039
Dec. 31, 2020 $8,730 $9,104 5,587 91,413
2021 8,730 9,141 5,176 91,824
2022 8,730 9,182 4,724 92,276
2023 8,730 9,228 4,226 92,774
2024 8,730 9,277 3,679 93,321
2025 8,730 9,332 3,077 93,923
2026 8,730 9,392 2,415 94,585
2027 8,730 9,459 1,686 95,314
2028 8,730 9,531 885 96,115
2029 8,730 9,615 0 $97,000

Determine the stated interest rate and the effective interest rate. (Round answers to 0 decimal places, e.g. 15%.)

Stated Interest Rate %
Effective Interest Rate %

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Based on the schedule above, prepare the journal entry to record the issuance of the bonds on January 1, 2020. (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.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1, 2020

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List of Accounts

  

  

Based on the schedule above, prepare the journal entry to reflect the bond transactions and accruals for 2020. (Interest is paid January 1.) (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.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31, 2020

eTextbook and Media

List of Accounts

  

  

Based on the schedule above, prepare the journal entries to reflect the bond transactions and accruals for 2028. Marigold Corporation does not use reversing entries. (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. Record journal entries in the order presented in the problem.)

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ekkarill92 answered 1 year ago
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