Bonds-Logan Corporation
Not what you're looking for?
Logan Corporation issued $800,000 of 8% bonds on October 1, 2006, due on October 1, 2011. The interest is to be paid twice a year on April 1 and October 1. The bonds were sold to yield 10% effective annual interest. Logan Corporation closes its books annually on December 31.
Instructions
(a) Complete the following amortization schedule for the dates indicated. (Round all answers to the nearest dollar.) Use the effective-interest method.
Debit Credit Carrying Amount
Credit Cash Interest Expense Bond Discount of Bonds
01-Oct-06 $738,224
01-Apr-07
01-Oct-07
(b) Prepare the adjusting entry for December 31, 2007. Use the effective-interest method.
(c) Compute the interest expense to be reported in the income statement for the year ended December 31, 2007.
Purchase this Solution
Solution Summary
The solution explains journal entries relating to bond transactions
Purchase this Solution
Free BrainMass Quizzes
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.
Writing Business Plans
This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.
Understanding Management
This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.
Marketing Management Philosophies Quiz
A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.
Balance Sheet
The Fundamental Classified Balance Sheet. What to know to make it easy.