On January 1,2015,Brewers Corporation issued $800,000 of 6%,5-year bonds at 98,with interest paid annually.Using the straight-line amortization method,what is the carrying value of the bonds on January 1,2015?

Question

Quizplus · Accepted Answer

The bonds were issued at 98, meaning they were issued at 98% of the face value. Therefore, the initial carrying value is 98% of $800,000, which is $784,000.

On January 1,2015,Brewers Corporation Issued $800,000 of 6%,5-Year Bonds at 98,with