Bridgeport Corp. issued $365,000,8%,25-year bonds on January 1, 2017

Bridgeport Corp. issued $365,000,8%,25-year bonds on January 1, 2017, for $329,149. This price resulted in an effective-interest rate of9% on the bonds. Interest is payable annually on January 1. Bridgeport uses the effective-interest method to amortize bond premium or discount.

Prepare the schedule using effective-interest method to amortize bond premium or discount of Bridgeport Corp

Prepare the journal entry to record the accrual of interest and the discount amortization on December 31, 2017

Prepare the journal entry to record the payment of interest on January 1, 2018.

Here’s the SOLUTION

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