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Prepare the journal entry to record the interest revenue

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On January 1, 2020, Majestic Company purchases at par 8% bonds having a maturity value of $500,000. They are dated January 1, 2020 and mature January 1, 2025, with interest received on January 1 of each year. The bonds are classified in the held-to-maturity category.

Problem 1: Prepare the journal entry at the date of the bond purchase.

Problem 2: Prepare the journal entry to record the interest revenue on December 31, 2020

Problem 3: Prepare the journal entry to record the interest received on January 1, 2021

Reference no: EM132808355

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