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Prepare the journal entry to record their issuance

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Question - Hartford Research issues bonds dated January 1 that pay interest semiannually on June 30 and December 31. The bonds have a $40,000 par value and an annual contract rate of 10%, and they mature in 10 years.

Required - Consider each separate situation.

1. The market rate at the date of issuance is 8%.

(a) Complete the below table to determine the bonds' issue price on January 1.

(b) Prepare the journal entry to record their issuance.

2. The market rate at the date of issuance is 10%.

(a) Complete the below table to determine the bonds' issue price on January 1.

(b) Prepare the journal entry to record their issuance.

3. The market rate at the date of issuance is 12%.

(a) Complete the below table to determine the bonds' issue price on January 1.

(b) Prepare the journal entry to record their issuance.

Reference no: EM133043593

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