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Explanations with the answer please Comprehensive Bond Problem In each of the following independent cases the company closes its books on December 31 Titania Co.

Explanations with the answer please

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Comprehensive Bond Problem In each of the following independent cases the company closes its books on December 31 Titania Co. sells bonds on June 1, 2017. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2021. On October 1, 2018 Titania buys back a portion of the bonds. Additional information follows: 400,000 Par value of the bonds issued 12% Stated interest rate Bond yield rate 10% Face amount of bonds bought back 120,000 126,000 Amount paid to buy back bonds including interest Give the entries through December 1, 2019 Instructions: Prepare all of the relevant journal entries from the time of sale until the date indicated. Use the effective-interest method for discount and premium amortization (construct amortization tables where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.) Titania Co. Schedule of Bond Premium Amortization Effective Interest Method 12% Bonds Sold to Yield 10% Book Value Date Cash Interest Bond

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