Waxman Corporation issued bonds twice during 20x2. A summary of the transactions involving
the bonds follows. 2002 Jan 1 Issued $6,000,000 of 9.9 percent ten-year bonds dated January 1, 20x2, with interest
payable on June 30 and December 31. The bonds were sold at 102.6, resulting in an
effective interest rate of 9.4 percent. Mar 1 Issued $4,000,000 of 9.2 percent, ten-year bonds dated March 1, 2002, with interest
payable March 1 and September 1. The bonds were sold at 98.2, resulting in an effective
interest rate of 9.5 percent. June 30 Paid semiannual interest on January 1 issue and amortized the premium, using the
effective interest method. Sept 1 Paid semiannual interest on the March 1 issue and amortized the premium, using the
effective interest method. Dec 31 Paid semiannual interest on the January 1 issue and amortized the premium, using the
effective interest method. 31 Made an end-of-year adjusting entry to accrue interest on the March 1 issue and to amortize
two-thirds of the discount to the second interest period.
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