The Bradford Company issued 12% bonds, dated January 1, with a
face amount of $92 million on January 1, 2021. The bonds mature on
December 31, 2030 (10 years). For bonds of similar risk and
maturity, the market yield is 14%. Interest is paid semiannually on
June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1,
FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from
the tables provided.)
Required:
1. Determine the price of the bonds at January 1,
2021.
2. to 4. Prepare the journal entries to record
their issuance by The Bradford Company on January 1, 2021, interest
on June 30, 2021 and interest on December 31, 2021 (at the
effective rate).
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The Bradford Company issued 12% bonds, dated January 1, with a face amount of $92 million...
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The Bradford Company issued 8% bonds, dated January 1, with a face amount of $50 million on January 1, 2021 to Saxton-Bose Corporation. The bonds mature on December 31, 2030. For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. 1. Prepare the journal entry to record the purchase of the bonds by Saxton-Bose on January 1, 2021. 2. Prepare the journal entry to record interest for Saxton-Bose...
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