Journalize the entries to record first semiannual interest

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Entries for Issuing Bonds and Amortizing Discount by Straight-Line Method On the first day of its fiscal year, Chin Company issued $14,100,000 of five-year, 12% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 13%, resulting in Chin receiving cash of $13,593,243.

Problem a. Journalize the entries to record the following:

1. Issuance of the bonds.

2. First semiannual interest payment. The bond discount is combined with the semiannual interest payment.

 

Reference no: EM132662758

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