Problem p17-1. (debt securities) 2 presented below is an amortization

Problem P17-1. (Debt Securities) 2 Presented below is an amortization schedule related to Spangler Company’s 5-year, $100,000 bond with a 7% interest rate
and a 5% yield, purchased on December 31, 2012, for $108,660. Date Cash Received Interest Revenue Bond Premium Amortization Carrying Amount of Bonds 12/31/12 $108,660 12/31/13 $7,000 $5,433 $1,567   107,093 12/31/14   7,000   5,354   1,646   105,447 12/31/15
7,000   5,272   1,728   103,719 12/31/16   7,000   5,186   1,814   101,905 12/31/17   7,000   5,095   1,905   100,000 The following schedule presents a comparison of the amortized cost and fair value of the bonds at year-end. 12/31/13 12/31/14 12/31/15 12/31/16
12/31/17 Amortized cost $107,093 $105,447 $103,719 $101,905 $100,000 Fair value $106,500 $107,500 $105,650 $103,000 $100,000

Instructions

(a) Prepare the journal entry to record the purchase of these bonds on December 31, 2012, assuming the bonds are classified as held-to-maturity securities.

(b) Prepare the journal entry(ies) related to the held-to-maturity bonds for 2013.

(c) Prepare the journal entry(ies) related to the held-to-maturity bonds for 2015.

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