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The Bradford Company issued 8% bonds, dated January 1, with a face amount of $60 million...

The Bradford Company issued 8% bonds, dated January 1, with a face amount of $60 million on January 1, 2018 to Saxton-Bose Corporation. The bonds mature on December 31, 2023 (6 years). For bonds of similar risk and maturity, the market yield is 10%. 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. to 3. Prepare the journal entry to record the purchase of the bonds by Saxton-Bose on January 1, 2018, interest revenue on June 30, 2018 and interest revenue on December 31, 2018 (at the effective rate).

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Answer #1

Debit Credit o00 00o 2018 53 20000o 5457992 CaSH Tre 30, Cash 2018 | Discount on Bonds investment-13339n in忙rest Revenue 2133916 Dec 3 Ca Sh 215066 Face Va lve at Bonds60000 o00 Semi Annual EhValue 4 x 6ooco 2Lt 00000 mi Annual rarer+ yieed -5% Katirit Pcriod nds二 戶2400000x PVA(5%) 194 22127,920 3340Bo00 5467972o

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