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need help Smiley Corporation wholesales repair products to equipment manufacturers. On April 1,20Y1,5miley issued $1,000,000 of 10 -year, 8% bond at a market (effective) interest
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Smiley Corporation wholesales repair products to equipment manufacturers. On April 1,20Y1,5miley issued $1,000,000 of 10 -year, 8% bond at a market (effective) interest rate of 6%, receiving cash of $1,148,775. Interest is payable semiannually on April 1 and October 1. a. Joumalize the entry to record the issuance of bonds on April 1, 20Y1. If an amount box does not require an entry, leave it blank. b. Journalize the entry to record the first interest payment on October 1, 20Y1, and amortization of bond premium for six months, using the straight-line method. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. C. Why was the company able to issue the bonds for $1,148,775 rather than for the face amount of $1,000,000 ? The market rate of interest is the contract rate of interest. Pinder Co. produces and sells high-quality video equipment. To finance its operations, Pinder issued $25,000,000 of five-year, 7% bonds, with interest payable semiannually, at a market (effective) interest rate of 9%. Determine the present value of the bonds payable, using the present value tables in Exhibit 5 and Exhibit 7. Round to the nearest dollar Step by Step Solution
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