Question
Distributors sells snack and candy to local stores. On March 1, 2010, Borges issued $4,000,000 of 5-year, 13% bonds at an effective interest rate of
Distributors sells snack and candy to local stores. On March 1, 2010, Borges issued $4,000,000 of 5-year, 13% bonds at an effective interest rate of 11%. Interest is payable semiannually on March 1 and September 1. Journalize the entries to record the following:
- Sale of bonds on March 1, 2010. Use the tables on present values in Appendix A of your textbook to determine the present value of the bond issue. Round to nearest dollar.
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- First interest payment on September 1, 2010, and amortization of bond premium for six months, using the straight-line method. Round to the nearest dollar.
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