|On 7/1/16, ABC sold 10% bonds having a maturity value of $700,000 for $756,773.50, resulting in an effective yield of 8%. The bonds are|
|dated 7/1/16, and mature 7/1/21. Interest is payable semiannually on July 1 and January 1. ABC uses the effective interest method of|
|amortization for bond premium or discount. Record the adjusting entry for the accrual of interest and the related amortization on 12/31/16.|
Hint: Develop an abbreviated amortization schedule to accurately determine the interest expense.
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