Pretzelmania, Inc., issues 7%, 10-year bonds with a face amount of $70,000 for $70,000 on January 1, 2021. The market interest ratefor bonds of similar risk and maturity is 7%. Interest is paid semiannually on June 30 and December 31.Required:1. & 2. Record the bond issue and first interest payment on June 30, 2021. (If no entry is required for a particular transaction/event,select "No Journal Entry Required" in the first account field.)

The bonds are issued at par when market rate is similar to coupon rate of bonds.

Answered: PPetzelmaniá, Inc., issues 7%, 10-year…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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