On January 1, 2012 ABC, Inc. issued 20,000 10-year bonds (par value of $1,000 each), with...
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On January 1, 2012 ABC, Inc. issued 20,000 10-year bonds (par value of $1,000 each), with an 8% coupon rate, and interest paid semiannually (twice a year). The first payment is scheduled to occur on June 30th. At the time of the bond issuance, the market rate for a similar debt security was currently yielding 6%. ABC, Inc. becomes more credit worthy over the first 2 years after the initial bond issuance, and the market is now (1/1/2014) demanding an interest rate of only 4%. What is the journal entry that ABC, Inc. would record on 1/1/2012? On January 1, 2012 ABC, Inc. issued 20,000 10-year bonds (par value of $1,000 each), with an 8% coupon rate, and interest paid semiannually (twice a year). The first payment is scheduled to occur on June 30th. At the time of the bond issuance, the market rate for a similar debt security was currently yielding 6%. ABC, Inc. becomes more credit worthy over the first 2 years after the initial bond issuance, and the market is now (1/1/2014) demanding an interest rate of only 4%. What is the journal entry that ABC, Inc. would record on 1/1/2012?
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Related Book For
Horngrens Financial And Managerial Accounting The Financial Chapters
ISBN: 9780134486840
6th Edition
Authors: Tracie L. Miller Nobles, Brenda L. Mattison, Ella Mae Matsumura
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