Long-term liabilities DENZEL CORPORATION Balance Sheet (Partial) At June 30 +
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:E10-8 (Algo) Recording and Reporting a Bond Issued at a Discount (with Discount Account) LO10-4
Denzel Corporation is planning to issue bonds with a face value of $670,000 and a coupon rate of 7.5 percent. The bonds mature in 6
years and pay interest semiannually every June 30 and December 31. All of the bonds were sold on January 1 of this year. Denzel uses
the effective interest amortization method and also uses a discount account. Assume an annual market rate of interest of 8.5 percent
(FV of $1. PV of $1. EVA of $1, and PVA of $1)
Note: Use appropriate factor(s) from the tables provided.
Required:
1. and 2. Prepare the journal entries to record the issuance of the bonds and interest payment on June 30 of this year.
3. What bonds payable amount will Denzel report on its June 30 balance sheet?

Transcribed Image Text:Long-term liabilities
DENZEL CORPORATION
Balance Sheet (Partial)
At June 30
+
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