INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
9th Edition
ISBN: 9781260216141
Author: SPICELAND
Publisher: MCG CUSTOM
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Chapter 14, Problem 14.6E
Bonds; issuance; effective interest
• LO14–2
The Gorman Group issued $900,000 of 13% bonds on June 30, 2018, for $967,707. The bonds were dated on June 30 and mature on June 30, 2038 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually on December 31 and June 30.
Required:
1. Prepare the
2. Prepare the journal entry to record interest on December 31, 2018 (at the effective rate).
3. Prepare the journal entry to record interest on June 30, 2019 (at the effective rate).
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Chapter 14 Solutions
INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
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