Prepare the journal entry at the date of the bond issuance

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Question - Rama Corporation issued $600,000 of 8% term bonds on January 1, 2017, due on January 1, 2022, with interest payable each July 1 and January 1. Investors require an effective-interest rate of 10%.

Required -

1. Prepare the journal entry at the date of the bond issuance (show the calculation)?

2. Prepare a schedule of interest expense and bond amortization from 1/1/2017 to 1/1/2020?

3. Prepare the journal entry to record the interest payment and the amortization for July 1, 2018.

4. Prepare the journal entry to record the interest payment and the amortization for December 31, 2019.

5. Calculate the discount on bonds payable (show the calculation).

Reference no: EM132528876

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