On January 1, 2021, Bank Nizwa. issued RO 90,000, five-year, 12% bonds at (100% of face value). Assume that interest is payablesemiannually on January 1 and July 1. Prepare the entry to record the payment of interest on July 1, 2021Select one:O a.Interest Expense5,400Cash5,400O b.Interest Payable10,800Interest Expenses10,800O c.Interest Payable5,400Interest Expenses5,400O d.Interest Expense10,800Cash10,800Cirill lis ais!

1. Amount of interest to be paid is calculated on the face value. 2. Journal entry for recording…

Answered: nd July 1. Prepare the entry to record…

Business

Accounting

nd July 1. Prepare the entry to record the payment of interest on July 1, 2021

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 7MC: On January 1 a company issues a $75,000 bond that pays interest semi-annually. The first interest...

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Edward Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $480,000. Interest is payable semiannually. The discount is amortized using the straight-line method. Prepare journal entries for the following transactions. A. July 1, 2018: entry to record issuing the bonds B. Dec. 31, 2018: entry to record payment of interest to bondholders C. Dec. 31, 2018: entry to record amortization of discount
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On January 1 a company issues a $75,000 bond that pays interest semi-annually. The first interest payment of $1,875 is paid on July 1. What is the stated annual interest rate on the bond? A. 5.00% B. 2.50% C. 1.25% D. 10.00%
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