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Problem 14-2 Sheffield Co. is building a new hockey arena at a cost of $2,750,000. It received a downpayment of $470,000 from local businesses to
Problem 14-2 Sheffield Co. is building a new hockey arena at a cost of $2,750,000. It received a downpayment of $470,000 from local businesses to support the project, and now needs to borrow $2,280,000 to complete the project. It therefore decides to issue $2,280,000 of 10%, 10-year bonds. These bonds were issued on January 1, 2016, and pay interest annually on each January 1. The bonds yield 9%. ssume that on July 1, 2019, Sheffield Co. redeems half of the bonds at a cost of $1,222,500 plus accrued interest. Prepare the journal entry to ecord this redemption. (Round answers to o decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation uly 1, 2019 Tinterest Expense Premium on Bonds Payable | cash Cash 114000 (To record interest) July 1, 2019 TBonds Payable 140000 TPremium on Bonds Payable 1491811 Loss on Redemption of Bonds | Cash 1222500 (To record reacquisition) Click if you would like to Show Work for this question: Open Show Work
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