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Zolf Corporation issued $60,000 of 6 percent, 10-year bonds on January 1, 2013, for a price that reflected a 7 percent market rate of interest. Interest is payable annually on December 31.
Required
a. What was the selling price of the bonds?
b. Prepare the journal entry to record issuing the bonds.
c. Prepare the journal entry for the first interest payment on December 31, 2013, using the effective interest rate method.
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