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Prepare journal entry to record the issuance of the bonds

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Question - Recording Bond Issue and First Interest Payment with Premium (Effective-Interest Amortization)

On January 1, 2018, Bochini Corporation sold a $10 million, 8.25 percent bond issue. The bonds were dated J annary 1, 2018, had a yield of 8 percent, pay interest each December 31, and mature 10 years from the date of issue.

Required -

1. Prepare the journal entry to record the issuance of the bonds.

2. Prepare the journal entry to record the interest payment on December 31, 2018. Use effective-interest amortization.

Reference no: EM132499940

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