Issuing Bonds at a Face Amount

On January 1, the first day of the fiscal year, Designer Fabric Inc. issues a $600,000, 7%, 10-year bond that pays semiannual interest of $21,000 ($600,000 7% year), receiving cash of $600,000.

(a) Journalize the entry to record the issuance of the bonds.

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(b) Journalize the entry to record the first interest payment on June 30.

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(c) Journalize the entry to record the payment of the principal on the maturity date.

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