Tarawa Limited issued $1 million of 10-year, 5% bonds on January 1, 2018, when the market interest
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Instructions
(a) Record the issue of the bonds on January 1.
(b) Record the payment of interest on July 1.
(c) Record the accrual of interest on December 31.
(d) Prove the amount of cash received when the bonds were sold by determining the bonds' present value (issue price) on January 1, 2018. Prove the carrying amount of the bonds, one year later, by determining the present value of the bonds at that time.
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Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119368458
7th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
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