Teal Co.sells $365,000 of 12% bonds on June 1, 2020. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2024. The bonds yield 8%. On October 1, 2021, Teal buys back $116,800 worth of bonds for $123,800 (includes accrued interest). Give entries through December 1, 2022. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to O decimal places, e.g. 38,548.) (To record interest expense and premium amortization) 10/1/21 Bonds Payable Premium on Bonds Payable Gain on Redemption of Bonds Cash (To record buy back of bonds) 116800 10621 8293 119128

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Ee 148.

Teal Co.sells $365,000 of 12% bonds on June 1, 2020. The bonds pay interest on December 1 and June 1. The due date of the
bonds is June 1, 2024. The bonds yield 8%. On October 1, 2021, Teal buys back $116,800 worth of bonds for $123,800 (includes
accrued interest). Give entries through December 1, 2022.
Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize
premium or discount on interest dates and at year-end. (Round answers to O decimal places, e.g. 38,548.)
(To record interest expense and premium amortization)
10/1/21 Bonds Payable
Premium on Bonds Payable
Gain on Redemption of Bonds
Cash
(To record buy back of bonds)
116800
10621
8293
119128
Transcribed Image Text:Teal Co.sells $365,000 of 12% bonds on June 1, 2020. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2024. The bonds yield 8%. On October 1, 2021, Teal buys back $116,800 worth of bonds for $123,800 (includes accrued interest). Give entries through December 1, 2022. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to O decimal places, e.g. 38,548.) (To record interest expense and premium amortization) 10/1/21 Bonds Payable Premium on Bonds Payable Gain on Redemption of Bonds Cash (To record buy back of bonds) 116800 10621 8293 119128
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