Question
Bond Bondy Corp. is authorized to issue $1,000,000 of 7%, ten-year bonds payable. On April 1, 2019 when the market interest rate is 8%, the
Bond Bondy Corp. is authorized to issue $1,000,000 of 7%, ten-year bonds payable. On April 1, 2019 when the market interest rate is 8%, the company issues $300,000 of the bonds at 97, and incurred bond issue cost of $10,000. Bond Bondy measures interest expense by the effective-interest method. The bonds pay interest semi-annually on June 30th and December 31st.
Required:
1. Prepare an entry on page 2 of the General Journal on April 1, 2019
2. Prepare an amortization table for the first four semiannual interest periods.
3. Record the first semiannual interest expense on June 30th
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