Question
On July 1, 2021, Crane Satellites Corporation issued $1,100,000 of 10-year, 9% bonds to yield a market interest rate of 8%. The bonds pay semi-annual
On July 1, 2021, Crane Satellites Corporation issued $1,100,000 of 10-year, 9% bonds to yield a market interest rate of 8%. The bonds pay semi-annual interest on July 1 and January 1. Crane has a December 31 year end and records adjusting entries annually. Crane received $1,174,750 when issuing the bonds. 1.Prepare an amortization table through January 1, 2023 (three interest periods) for this bond issue. 2. Record the issue of the bonds on July 1, 2021. 3. Prepare the adjusting entry on December 31, 2021, to accrue the interest on the bonds. 4. Record the payment of interest on January 1, 2022, and July 1, 2022. 5. Prepare the adjusting entry on November 30, 2021, to accrue the interest on the bonds, assuming the companys year end was November 30, 2021. 6. Record the payment of interest on January 1, 2022, assuming the companys year end was November 30.
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