Prepare the journal entry to record sale of the new issued

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ABCD Corp. had an outstanding P6, 000,000 of 11% bonds due in 10 years. Interest is payable every July 31 and January 31. On July 1, it issued P9, 000,000 of 9%, 15-year bonds where interest is payable on July 1 and January 1 at 97. A portion of the proceeds was used to call the 10% bonds at 103 on August 1. Unamortized bond discount and issue cost applicable to the 10% bonds were P240, 000 and P60,000, respectively.

Problem a. Prepare the journal entry to record the sale of the new issued

Problem b. Prepare the journal entry to record the retirement of the old issued bonds.

Reference no: EM132803922

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