2. Scrappy Company issued $300,000 of 10% bonds on January 1, 2017. The bonds were sold on January 1,
2017 for $315,000, and they were expected to yield 8% interest paid semi-annually. The interest dates are
June 30 and December 31. The maturity date of the bonds is December 31, 2024.
Required: Prepare the journal entries to record:
a. The issuance of the bonds on January 1, 2017.
b. The amortization and the first two interest payments under the effective interest method.
ROUND YOUR ANSWERS TO THE NEAREST DOLLAR
Date
Issuance of the bonds on January 1, 2017
Date
The amortization and the first two interest payments