Question
X Corporation on January 1, 2020, issues $100,000 (100 bond @ $1000 face value) of 12% bonds due in 5 years with interest payable semiannually
X Corporation on January 1, 2020, issues $100,000 (100 bond @ $1000 face value) of 12% bonds due in 5 years with interest payable semiannually July 1, and Dec.31. The current market rate of interest for bonds of similar risk is 7%.
Instructions:
- What will the buyers pay for this bond issue?
- Record the journal entry
- Record the adjusting entry on December 31, 2020. Assume that X uses the SLM for amortization.
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Cost Accounting A Managerial Emphasis
Authors: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
14th Global Edition
978-0273753872, 0273753878
