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Exercise 14-7 (Algo) Determine the price of bonds; issuance; straight-line method (L014-2] Universal Foods issued 10% bonds, dated January 1, with a face amount of
Exercise 14-7 (Algo) Determine the price of bonds; issuance; straight-line method (L014-2] Universal Foods issued 10% bonds, dated January 1, with a face amount of $140 million on January 1, 2021. The bonds mature on December 31, 2040 (20 years). The market rate of interest for similar issues was 12%, Interest is paid semiannually on June 30 and December 31. Universal uses the straight-line method (EV of $1. PV of $1. EVA of $1. PVA of $1. VAD of $1 and PVAD of $1 (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds at January 1, 202 2. to 4. Prepare the journal entries to record their issuance by Universal Foods on January 1, 2021, interest on June 30, 21 and Interest on December 31, 2028. Complete this question by entering your answers in the tabs below. Req 1 Reg 2 to 4 all- Issuan interest on December 31, 2028. by universal Foods on - Complete this question by entering your answers in the tabs below. Req 1 Reg 2 to 4 Determine the price of the bonds at January 1, 2021. (Round final answers to the nea Table values are based on: n = i=1 % Amount Present Value Cash Flow Interest Principal Price of bonds Req1 Req 2 to 4 > Journal entry worksheet -FREE
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