On January 1, 2021, Kramer International Inc. issued $ 200,000, 9%, 5-year bonds for $ 192,278. The bonds were sold to yield an effective interest rate of 10%. Interest is paid semi-annually on June 30 and December 31. The company uses the effective-interest method of amortization.
Instructions
a) Prepare a bond discount amortization schedule that shows the amortization of the discount for the first two interest payment dates. (Round to the nearest dollar.)
b) Prepare the journal entries that Kramer International would make on January 1, June 30, and December 31, 2021, related to the bond issue.

Question

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The Answer of On January 1, 2021, Kramer International Inc. issued $ 200,000, 9%, 5-year bonds for $ 192,278. The bonds were sold to yield an effective interest rate of 10%. Interest is paid semi-annually on June 30 and December 31. The company uses the effective-interest method of amortization.
Instructions
a) Prepare a bond discount amortization schedule that shows the amortization of the discount for the first two interest payment dates. (Round to the nearest dollar.)
b) Prepare the journal entries that Kramer International would make on January 1, June 30, and December 31, 2021, related to the bond issue.