On February 1, Year 1, a company issued 10% bonds, dated February 1, with a face amount of $930,000. • The bonds sold for $855,382 and mature on January 31, Year 21 (20 years). . The market yield for bonds of similar risk and maturity was 11%. • Interest is paid semiannually on July 31 and January 31. • The company's fiscal year ends December 31. Required: 1. to 4. Prepare the journal entries to record their issuance by the company on February 1, Year 1, interest on July 31, Year 1 (at the effective rate), adjusting entry to accrue interest on December 31, Year 1 and interest on January 31, Year 2. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar. transaction/event, select "No journal entry required" in the first account field. no entry is required for a
On February 1, Year 1, a company issued 10% bonds, dated February 1, with a face amount of $930,000. • The bonds sold for $855,382 and mature on January 31, Year 21 (20 years). . The market yield for bonds of similar risk and maturity was 11%. • Interest is paid semiannually on July 31 and January 31. • The company's fiscal year ends December 31. Required: 1. to 4. Prepare the journal entries to record their issuance by the company on February 1, Year 1, interest on July 31, Year 1 (at the effective rate), adjusting entry to accrue interest on December 31, Year 1 and interest on January 31, Year 2. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar. transaction/event, select "No journal entry required" in the first account field. no entry is required for a
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Vijay
Transcribed Image Text:On February 1, Year 1, a company issued 10% bonds, dated February 1, with a face amount of $930,000.
• The bonds sold for $855,382 and mature on January 31, Year 21 (20 years).
The market yield for bonds of similar risk and maturity was 11%.
• Interest is paid semiannually on July 31 and January 31.
●
The company's fiscal year ends December 31.
Required:
1. to 4. Prepare the journal entries to record their issuance by the company on February 1, Year 1, interest on July 31, Year 1 (at the
effective rate), adjusting entry to accrue interest on December 31, Year 1 and interest on January 31, Year 2.
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar. If no entry is required for a
transaction/event, select "No journal entry required" in the first account field.
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