Rock Company issued a $1,000,000 bond for $924,184 on January 1, 2010. The bond had a 8% stated rate, pays interest annually on December 31, and the market rate of interest was 10%. Rock uses the effective-interest method to account for its bonds. Prepare the necessary journal entry for each of the following dates (assuming that no adjusting journal entries have been made during the year): January 1, 2010 December 31, 2010 December 31, 2011

Rock Company issued a $1,000,000 bond for $924,184 on January 1, 2010. The bond had a 8% stated rate, pays interest annually on December 31, and the market rate of interest was 10%. Rock uses the effective-interest method to account for its bonds. Prepare the necessary journal entry for each of the following dates (assuming that no adjusting journal entries have been made during the year): January 1, 2010 December 31, 2010 December 31, 2011

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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