The Wilfred Company sold 8% bonds, dated January 1, with a face amount of $90 million on January 1, year 1 to Rexton-Base Corporation. The bonds mature on December 31, year 10 (10 years). For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. Prepare the journal entry to record interest revenue on June 30, year 1 (at the effective rate).

The Wilfred Company sold 8% bonds, dated January 1, with a face amount of $90 million on January 1, year 1 to Rexton-Base Corporation. The bonds mature on December 31, year 10 (10 years). For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. Prepare the journal entry to record interest revenue on June 30, year 1 (at the effective rate).

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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