Question

Exercise 17-3 (Part Level Submission) On January 1, 2017, Marin Company purchased 10% bonds having a maturity value of $220,000, for $237,567.22. The bonds provide the bondholders with a 8% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Ma discount or premium. The bonds are classified in the held-to-maturity category. (a) Your answer is correct. Prepare the journal entry at the date of the bond purchase. (Enter answers to 2 decimal places, e.g. 2,525.25. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Debit Credit Date Account Titles and Explanation Jan. 1, 2017 Debt Investments 237567.22 Cash 237567.22

Answer 1

Solution b:

Schedule of Interest revenue and Bond Premium Amortization
Date	Cash Received	Interest revenue	Premium Amortized	Carrying amount of bonds
1-Jan-17				$237,567.22
1-Jan-18	$22,000.00	$19,005.38	$2,994.62	$234,572.60
1-Jan-19	$22,000.00	$18,765.81	$3,234.19	$231,338.41
1-Jan-20	$22,000.00	$18,507.07	$3,492.93	$227,845.48
1-Jan-21	$22,000.00	$18,227.64	$3,772.36	$224,073.12
1-Jan-22	$22,000.00	$17,926.88	$4,073.12	$220,000.00