answers

Exercise 14-18 (Part Level Submission)On June 30, 2010, Concord Limited issued 11.25% bonds with a par value of $004,000 due in 20 years.They were issued at 95 and were callable at 104 at any date after June 30, 2017. Because of lower interest rates and a significant change in the company's credit rating, it was decided tocall the entire issue on June 30, 201? and to issue new bonds. New 10% bonds were sold in the amount of$1 million at 103; they mature in 20 years. The companyr follows ASPE and uses straight—Lineamortization. The interest payment dates are December 31 and June 30 of each year. a} Prepare IE. to record the retirement of the old issue 8: the sale of the new issue on June 30, 2017. Date Account Titles and Explanation Debit CreditJ one 30, l—201'? I I (To record retirement of old issue)June 30, l—201? I I {To record sale of new issue]