Answer:
The amount fox should report on Dec 31,20x1 = $4,556,500
Explanation:
The carrying amount of bonds = $4,580,000 - $50,000
The carrying amount of bonds = $4,530,000
Amortization of discount from july 1 to dec 31 (6 months):
Interest Revenue = $4,530,000* 10% * 6/12
Interest Revenue= $226500
Interest Receivable = $5,000,000 * 8% * 6/12
Interest Receivable = $200000
Discount amortized =Interest Revenue - Interest Receivable
Discount amortized = $226500 - $200000
Discount amortized = $26500
So:
The amount fox should report on Dec 31,20x1 = $4,530,000 + $26500
The amount fox should report on Dec 31,20x1 = $4,556,500
