Question

On January 1, 2014, Aumont Company sold 12% bonds having a maturity value of $500,000 for $537,907, which provides the bondholders with a 10% yield. The bonds are dated January 1, 2014, and mature January 1, 2019, with interest payable December 31 of each year. Aumont Company allocates interest and unamortized discount or premium on the effective-interest basis.(a) Prepare the journal entry at the date of the bond issuance. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)Date Account Titles and Explanation Debit CreditJanuary 1, 2014 (b) Prepare a schedule of interest expense and bond amortization for 2014?2016. (Round answers to 0 decimal places, e.g. 38,548.)Schedule of Interest Expense and Bond Premium AmortizationEffective-Interest MethodDate CashPaid InterestExpense PremiumAmortized CarryingAmount of Bonds1/1/14 $ $ $ $ 12/31/14 12/31/15 12/31/16 (c) Prepare the journal entry to record the interest payment and the amortization for 2014. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)Date Account Titles and Explanation Debit CreditDecember 31, 2014 (d) Prepare the journal entry to record the interest payment and the amortization for 2016. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)Date Account Titles and Explanation Debit CreditDecember 31, 2016

Answer 1

Answer:

a) 37,907.

Kindly go through the attachment for the other answers requested for from the question.

Explanation:

The journal entry for the issuance of Bond = 37,907.

The journal Entry for Interest Payment and Amortization in 2014 are in the attached file. Kindly go through it for the illustration through which the answers are gotten.