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Untitled Document34 - Aftertheentry, Long-term liabilities...

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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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  • Spring '08
  • staff
  • Generally Accepted Accounting Principles, $10,000, $1,246, premium account balance, long­term liability section

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