Prepare the adjusting journal entry that PCFI should make

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Problem - Pigs Can Fly Inc. (PCFI), a publicly traded entity, issued $3,000,000 of 8%, 15-year bonds on March 1, 2019. The bonds pay interest on September 1 and March 1 each year. The bonds were sold to yield 5%. On March 2, 2020, PCFI repurchased 10% of the bonds at a cost of $336,000 and retired them. PCFI's year end is December 31.

Required -

a) Prepare the adjusting journal entry that PCFI should make for the year ended December 31, 2019.

b) Prepare the journal entry that PCFI should make for the bonds retired on March 2, 2020.

Reference no: EM132855888

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