Johnson & Johnson issued bonds with a face value of $1,000,000 at a premium. The bonds have
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Question:
· Johnson & Johnson issued bonds with a face value of $1,000,000 at a premium. The bonds have a stated interest rate of 6% and mature in 5 years. Calculate the total amount of cash proceeds received from the bond issuance and the journal entry to record the transaction. Also, determine the amount of premium amortization for the first year using the effective interest method.
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