Question
On December 7, 2015, the Company issued $500 million aggregate principal amount of 3.45% senior notes due 2021, the proceeds of which were used for
On December 7, 2015, the Company issued $500 million aggregate principal amount of 3.45% senior notes due 2021, the proceeds of which were used for general corporate purposes.
Macys Retail Holdings, Inc. (Macys Holdings) is offering $500,000,000 aggregate principal amount of its 3.450% Senior Notes due January 15, 2021, which we refer to as the senior notes. The senior notes mature on January 15, 2021, unless earlier redeemed. Macys Holdings will pay interest on the senior notes semi-annually in arrears on each January 15 and July 15 of each year. The first interest payment will be made on July 15, 2016. The senior notes will rank equal in right of payment to any other existing or future senior unsecured obligations of Macys Holdings. The guarantee will rank equal in right of payment to all other existing and future senior unsecured obligations of Macys, Inc. Macys Holdings may redeem the senior notes at any time at the redemption price set forth herein. Upon the occurrence of both (i) a change of control of Macys, Inc. and (ii) within a specified period in relation to the change of control, the senior notes being downgraded by at least two of Fitch Ratings, Inc., Moodys Investors Service, Inc. and Standard & Poors Ratings Services and being rated below an investment grade rating by at least two of such rating agencies, Macys Holdings will be required to make an offer to purchase the senior notes at 101% of their principal amount. On and after December 15, 2020, Macys Holdings may redeem the senior notes at par, plus accrued and unpaid interest.
Prepare the journal entry for the first interest payment. Include the date. You can use the straight-line method to amortize the interest.
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Senior Notes Per Note Total $499,495,000 Initial public offering price (1) Underwriting discounts and commissions 99.899% 0.600% 99.299% $3,000,000 $496,495,000 Proceeds to Macy's Holdings (1)Step by Step Solution
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