Prepare journal entry to record issuance by universal food

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Universal foods issued 8 % bonds date January 1 with a face amount of $250 Million on January 1 2018. The bonds mature on December 31 ,2032 (15 years) . The market rate of interest for similar issues was 10%. Interest is paid semiannually on June 30 and December 31. Universal uses the straight line method .(FV of $1, PV of $1, FVA of $1, PVA od $1, FVAD of $1and PVAD of $1)(use appropriate factors from the tables provided.

Required

Question 1: Determine the price of the bonds at January 1 2018.

Question 2: Prepare the journal entry to record their issuance by universal foods on January 1 2018 interest on June 30 2018 and interest on December 31 2025

Reference no: EM132643762

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