Questions 10

On August 31, 2017, DEF Company issues a $1,000,000 10-year 5% bond. The market rate of interest is 5.5%. The bond quote is 96.1932. The companys fiscal- year end is July 31. The bond pays interest semi-annually on February 28, and August 31 each year.

Required:

a.) Complete every line of the effective interest table below.

b.) Record the journal entry for the issuance of the bond (August 31, 2017)

c.) Record the journal entry for the first semi-annual payment. (February 28, 2018) d.) Record the journal entry for the year end adjustment. (July 31, 2018)

e.) Record the journal entry for the second semi-annual payment.(August31,2018)