Titania co sells 400000 of 12 bonds on june 1 2012 the

Reference no: EM13574652

Titania Co. sells $400,000 of 12% bonds on June 1, 2012. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2016. The bonds yield 10%. On October 1, 2013, Titania buys back $120,000 worth of bonds for $126,000 (includes accrued interest). Give entries through December 1, 2014.

Instructions

(Round to the nearest dollar.)

For the case prepare all of the relevant journal entries from the time of sale until the date indicated.
Use the effective-interest method for discount and premium amortization (construct amortization tables
where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing

Reference no: EM13574652

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