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On the first day of the fiscal year, a company issues an $844,000, 7%, 10-year bond that pays semiannual interest of $29,540 ($844,000 x 7%
On the first day of the fiscal year, a company issues an $844,000, 7%, 10-year bond that pays semiannual interest of $29,540 ($844,000 x 7% x 1/2), receiving cash of $886,200. Journalize the entry to record the first interest payment and amortization of the premium using the straight-line method.
If an amount box does not require an entry, leave it blank.
blank | Bonds PayableCashDiscount on Bonds PayableInterest ExpenseInterest PayableInterest Expense | Interest Expense | Interest Expense |
Bonds PayableCashInterest RevenueInterest PayablePremium on Bonds PayablePremium on Bonds Payable | Premium on Bonds Payable | Premium on Bonds Payable | |
Bonds PayableCashDiscount on Bonds PayableInterest ExpensePremium on Bonds PayableCash | Cash | Cash |
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