Prepare schedule for interest expense and bond amortization

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Question - On January 1st, 2017, Fruit Chews Company sold 5%, 20-year bonds having a maturity value of $1,713,500 for $1,500,000 , which provides bondholders with a 6% yield to maturity.

The bonds are dated Jan 1, 2017. Interest is payable every July 1 and January 1. Use the effective interest method.

Required -

A) Prepare the journal entries for bond issuance.

B) Prepare the schedule for interest expense and bond amortization for the 20-year life of the bond.

C) Prepare the journal entries to record the interest payment and amortization got 2020, 2022, 2028, 2031, and 2033.

Reference no: EM132908009

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