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Oriole Company purchased $1525000 of 10 % bonds of Pharoah Company on January 1, 2025, paying $1433881. The bonds mature on January 1, 2031;
Oriole Company purchased $1525000 of 10 % bonds of Pharoah Company on January 1, 2025, paying $1433881. The bonds mature on January 1, 2031; interest is payable each July 1 and January 1. The discount of $91119 provides an effective yield of 11%. Oriole uses the effective-interest method and plans to hold these bonds to maturity. On July 1, 2025, Oriole should increase its Debt Investments account for the Pharoah Company bonds by
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Accounting
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
23rd Edition
978-0324662962
