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Entry to recognize receipt of the first interest payment

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On July 1, 2019, Rose Ltd. purchased $150,000 (par value) of Lily's 8% bonds. Because the market rate was 9%, Rose purchased them for $140,244. The bonds pay interest semi-annually on December 31 and June 30. Rose uses the amortized cost model and the effective-interest method to recognize interest income on bond investments.

Problem 1: Rounding values to the nearest dollar (if necessary), entry to recognize receipt of the first interest payment on December 31, 2019

Reference no: EM132619187

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