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On July 1 Year 1 Danzer Industries Inc issued 40000000 of 10year 7 bonds at a market effective interest rate of 8 receiving cash of 37282062 Interest on the bonds is payable

On July 1, Year 1, Danzer Industries Inc. issued $40,000,000 of 10-year, 7% bonds at a market (effective) interest rate of 8%, receiving cash of $37,282,062. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.
 

1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1.

2. Journalize the entries to record the following:
a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond discount, using the straight-line method. Round to the nearest dollar.

b. The interest payment on June 30, Year 2, and the amortization of the bond discount,00 using the straight-line method. Round to the nearest dollar.

May 07 2021 View more View Less

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