Question: On 1 June, Sea Fare Enterprises received authorisation from its board of directors to issue $1 500 000 of 6% 10-year debentures dated 1 July.

On 1 June, Sea Fare Enterprises received authorisation from its board of directors to issue $1 500 000 of 6% 10-year debentures dated 1 July. Interest is payable half-yearly on 31 December and 30 June each year.

Required

A. Record the issue of the debentures in general journal entry form, assuming allotment of all debentures on 1 July.

B. Record interest payments for 31 December and 30 June in the first financial year of issue.

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