Computation of interest payable

Reference no: EM1310833

Computation of interest payable.

A company issued 9%, 10-year bonds with a par value of $1,000,000 on Sept 1, 2007 when the market rate was 9%. The bonds were dated June 30, 2007. The bond issue price included accrued interest. Interest paid semi-annually on Dec 31 and June 30.

a) Prepare the issuer's journal entry to record the issuance of the bonds.

b) Prepare the issuer's journal entry to record semi-annual interest payment on Dec 31, 2007.

Reference no: EM1310833

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