On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9,400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. Immediately after issue of the bonds, the ledger balances appeared as follows: After the first interest payment on June 30, 2014, what was the balance in the discount account?

Question

On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9,400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. Immediately after issue of the bonds, the ledger balances appeared as follows:  After the first interest payment on June 30, 2014, what was the balance in the discount account?

Quizplus · Accepted Answer

The Answer of On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9,400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. Immediately after issue of the bonds, the ledger balances appeared as follows:  After the first interest payment on June 30, 2014, what was the balance in the discount account?

On January 2, 2014, Mahoney Sales Issued $10,000 in Bonds