PT ABC Elektronik sold €2,000,000, 9%, 10 years bonds on January 1, 2014

The bonds were dated January 1 and pay interest July 1 and January 1.
PT ABC Elektronik uses the straight line method to amortize bond premium or discount. The bonds were sold at 104

Instructions :
(a). Prepare the journal entry to record the issuance of the bonds on January 1, 2014.
(b). Prepare a bond premium amortization schedule for the first 4 interest periods.
c). Prepare the journal entries for interest and the amortization of the premium in 2014 and 2015.

Jawaban
a. 1/1/2014 Cash
Bonds Payable

b a

interest to be paid
Semiannual Interest Period
(2000,000 x 4,5 %

Issue date -
1 $ 90,000.00
2 $ 90,000.00
3 $ 90,000.00
4 $ 90,000.00

c
1-Jul-14 Interest Expense
Bonds Payable
Cash
31-Dec-14 Interest Expense
Bonds Payable
Interest Payable
1-Jan-15 Interest Payable
Cash
1-Jul-15 Interest Expense
Bonds Payable
Cash
31-Dec-15 Interest Expense
Bonds Payable
Interest Payable
m or discount. The bonds were sold at 104. Assume no interest is accrued on June 30.

ary 1, 2014.

ium in 2014 and 2015.

$ 2,080,000.00
$ 2,080,000.00

b c d
Interest Expenseto Premium
be Recorded (A)- Amortization Bond Carrying
(C) ( 80,000 : 20 ) Value

- - $ 2,080,000.00
$ 86,000.00 $ 4,000.00 $ 2,076,000.00
$ 86,000.00 $ 4,000.00 $ 2,072,000.00
$ 86,000.00 $ 4,000.00 $ 2,068,000.00
$ 86,000.00 $ 4,000.00 $ 2,064,000.00

$ 86,000.00
$ 4,000.00
$ 90,000.00
$ 86,000.00
$ 4,000.00
$ 90,000.00
$ 90,000.00
$ 90,000.00
$ 86,000.00
$ 4,000.00
$ 90,000.00
$ 86,000.00
$ 4,000.00
$ 90,000.00