The following partial amortization schedule is available for Courtney Company wh
ID: 2380426 • Letter: T
Question
The following partial amortization schedule is available for Courtney Company who sold $500,000, five-year, 10% bonds on January 1, 2014 for $520,000 and uses annual straight-line amortization.
BOND AMORTIZATION SCHEDULE
Interest Periods
Interest
to be paid
Interest expense
Premium Amortization
Unamortized Premium
Bond Carrying Value
January 1, 2014
$20,000
$520,000
January 1, 2015
(i)
(ii)
(iii)
(iv)
(v)
Which of the following amounts should be shown in cell (ii)?
$54,000
$46,000
$52,000
$40,000
BOND AMORTIZATION SCHEDULE
Interest Periods
Interest
to be paid
Interest expense
Premium Amortization
Unamortized Premium
Bond Carrying Value
January 1, 2014
$20,000
$520,000
January 1, 2015
(i)
(ii)
(iii)
(iv)
(v)
Explanation / Answer
$46,000
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