1. On July 1, the Doggy Daze Company issues $200,000 of bonds. The contract rate...
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Accounting
1. On July 1, the Doggy Daze Company issues $200,000 of bonds. The contract rate is 5% and on the date of issuance, the bonds were issued at $102,695. The bonds mature in 5 years and pay semi-annual interest.
A. Calculate the selling price of the bonds.
B. Prepare the journal entry to record the issuance of the bonds.
C. Prepare the journal entry to record the first interest payment on Dec 31.
2. On January 1, BUZZ Company issued %500,000 of bonds for $486,250. The bonds have a contract rate of 3% and were issued when the market rate was 4%. The bonds pay interest annually and mature in 20 years.
A. Prepare the journal entry for the issuance of the bonds on Jan 1.
B. Prepare the journal entry to record the first interest payment on Dec 31.
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