On July 1, 2015, ARC Industries Corporation issued for cash $500,000 of 20%, 10 year bonds with interest payable semi-annualy. The market rate of the bonds issued is 20%. a. Prepare the journal entry to record the issue of the bond (include dates). b. Calculate the interest to be paid semi-annually (include formula). C. Prepare the journal entry to record the interest paid (include date). d. Prepare the journal entry to retire the bond (include dates).
On July 1, 2015, ARC Industries Corporation issued for cash $500,000 of 20%, 10 year bonds with interest payable semi-annualy. The market rate of the bonds issued is 20%. a. Prepare the journal entry to record the issue of the bond (include dates). b. Calculate the interest to be paid semi-annually (include formula). C. Prepare the journal entry to record the interest paid (include date). d. Prepare the journal entry to retire the bond (include dates).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On July 1, 2015, ARC Industries Corporation issued for cash $500,000 of 20%, 10 year
bonds with interest payable semi-annually. The market rate of the bonds issued is 20%.
a. Prepare the journal entry to record the issue of the bond (include dates).
b. Calculate the interest to be paid semi-annually (include formula).
C. Prepare the journal entry to record the interest paid (include date).
d. Prepare the journal entry to retire the bond (include dates).
IF
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