presented below are two independent situations a cece winans 259928

Presented below are two independent situations.

(a) CeCe Winans Corporation incurred the following costs in connection with the issuance of bonds:

(1) Printing and engraving costs, $12,000;

(2) Legal fees, $49,000, and

(3) Commissions paid to underwriter, $60,000. What amount should be reported as Unamortized Bond Issue Costs, and where should this amount be reported on the balance sheet?

(b) Ron Kenoly Inc. issued $600,000 of 9%, 10-year bonds on June 30, 2008, for $562,500. This price provided a yield of 10% on the bonds. Interest is payable semiannually on December 31 and June 30. If Kenoly uses the effective interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2008.

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