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P11-9B McGovern Company

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Please help with journalizing the entry to amortize bond premium, interest payment and redemption of bonds.

See the attached file.

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The posting has solution to question P11-9B relating to bond issue and redemption by McGovern Company.

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See the attached file.
a. The interest to be paid is 3,000,000X8%/2=120,000. This is already accrued and shown as bond interest payable. The entry is
Jan 1 2007 Bond Interest Payable Dr 120,000
Cash Cr 120,000

b. The premium as on Jan 1, 2007 is 200,000. The total number of months outstanding is 120. Using straight line method, the amortization per month is 200,000/120=1,666.67 For ...

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