Market rate of interest at the date of issuance

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Reference no: EM13755516

On Jan 1, 2014, a company issued 10-year,10% bonds payable with par value of $500,000 and received $442,647 in cash proceeds. The market rate of interest at the date of issuance was 12%. The bonds pay interest semiannually on July and Jan 1. The issuer uses the straight-line method for amortization. Prepare the issuer's journal entry to record the first semiannual interest payment on July 1, 2014.

Reference no: EM13755516

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