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Sandhill Company issued $408,000 of 10%, 20-year bonds on January 1, 2017, at 102. Interest is payable semiannually on July 1 and January 1. Sandhill
Sandhill Company issued $408,000 of 10%, 20-year bonds on January 1, 2017, at 102. Interest is payable semiannually on July 1 and January 1. Sandhill Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.7705%. Prepare the journal entries to record the following.
| (a) | The issuance of the bonds. | |
| (b) | The payment of interest and related amortization on July 1, 2017. | |
| (c) | The accrual of interest and the related amortization on December 31, 2017. |
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