Solution-Lesley used the effective interest rate method

Lesley used the effective interest rate method

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Reference no: EM13921803

On January 1, 2013, Lesley Company issued bonds with a face value of $250,000, a stated rate of interest of 10 percent, and a five year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 12 percent at the time the bonds were issued. The bonds sold for $231,976. Lesley used the effective interest rate method to amortize bond discount.

Required;

a. Prepare an amortization table as shown below:

455_264-B-A-L (2931).png

b. What item(s) in the table would appear on the 2016 balance sheet?
c. What item(s) in the table would appear on the 2016 income statement?
d. What item(s) in the table would appear on the 2016 statement of cash flows?

Reference no: EM13921803

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Lesley used the effective interest rate method

Reference no: EM13921803

Reference no: EM13921803

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