E14-8 presented below are three independent situations.

E14-8 Presented below are three independent situations.

 

(a) CeCe Winans Corporation incurred the following costs in connection with the issuance of bonds: (1) printing and engraving costs, $12,470; (2) legal fees, $47,810, and (3) commissions paid to underwriter, $73,080.

What amount should be reported as Unamortized Bond Issue Costs, and where should this amount be reported on the balance sheet? (Round answer to 0 decimal places, e.g. 38,548.)

Amount to be reported as Unamortized Bond Issue Costs

 

$http://edugen.wileyplus.com/edugen/art2/common/pixel.gif section of the balance Sheet


(b) George Gershwin Co. sold $2,129,000 of 12%, 9-year bonds at 105 on January 1, 2014. The bonds were dated January 1, 2014, and pay interest on July 1 and January 1. If Gershwin uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2014, and December 31, 2014.
(Round answer to 0 decimal places, e.g. 38,548.)

Interest expense to be recorded

 

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(c) Ron Kenoly Inc. issued $710,300 of 8%, 9-year bonds on June 30, 2014, for $556,480. This price provided a yield of 12% on the bonds. Interest is payable semiannually on December 31 and June 30. If Kenoly uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2014.
(Round answer to 0 decimal places, e.g. 38,548.)

 

Interest expense to be recorded

 

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