Untitled Document34

Untitled Document34 - Aftertheentry, Long-term liabilities Bonds Payable Plus Premium on Bonds Payable 10,000 1,246 11,246 (excess)betweenthe cashr

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After the entry, the bonds would be included in the long-term liability section of  the balance sheet as follows: Long-term liabilities Bonds Payable 10,000 Plus: Premium on Bonds Payable 1,246 11,246 The premium account balance represents the difference (excess) between the  cash received and the principal amount of the bonds. The premium account  balance of $1,246 is amortized against interest expense over the twenty interest  periods. Unlike the discount that results in additional interest expense when it is 
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This note was uploaded on 12/25/2011 for the course FIN 3312 taught by Professor Staff during the Spring '08 term at Texas State.

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Untitled Document34 - Aftertheentry, Long-term liabilities Bonds Payable Plus Premium on Bonds Payable 10,000 1,246 11,246 (excess)betweenthe cashr

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