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Question 2 - 25 Marks Al Evermaster Corporation issued 100,000 of 8% term bonds on January 1, 2015, due on January 1, 2020, with interest
Question 2 - 25 Marks Al Evermaster Corporation issued 100,000 of 8% term bonds on January 1, 2015, due on January 1, 2020, with interest payable each July 1 and January 1. The investor, Robinsoin Company requires an effective interest rate of 10%. Evermaster and Robinson's financial year ends December 31. Required: i. Calculate the price at which the bonds should be sold ii. Prepare the bond amortization schedule (table) to July 1, 2016. (3 marks) (7 marks) iii. Prepare all required journal entries on behalf of Evermaster Corporation to December 31, (6 marks) iv. Now, assume Evermast prepares financial statements at the end of February 2015. Calculate the accrued interest and prepare the journal entry at February 2015. (3 marks) (Round to the nearest dollar.) 2015. B] Assume that Robinson purchased the Evermaster bonds on January 1, 2015, at a discount, and the price paid amounted to 92,278 v. Prepare all required journal entries on behalf of Robinson Company to December 31, (6 marks) 2015
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