On January 1 , 2 0 2 1 , Mania Enterprises issued 1 2 % bonds dated

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Question:

On January

1, 2021,

Mania Enterprises issued

12 %

bonds dated

January

1, 2021,

with a face amount of $

20

million. The bonds

mature in

2030 (10

years

) .

For bonds of similar risk and maturity,

the market yield is

10 % .

Interest is paid semiannually on June

30

and December

31 . (

FV of $

1,

PV of $

1,

FVA of $

1,

PVA of $

1,

FVAD of

1

and PVAD of $

1) (

Use appropriate factor

(

)

from the tables

provided. Round your intermediate calculations to the nearest whole

dollar.

)

Required:

1 .

Determine the price of the bonds at January

1, 2021 .

2 .

Prepare the journal entry to record the bond issuance by Mania

on January

1, 2021 .

3 .

Prepare the journal entry to record interest on June

30, 2021,

using the effective interest method.

4 .

Prepare the journal entry to record interest on December

31,

2021,

using the effective interest method.

Posted Date: May 09, 2024 03:17 AM

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On January 1 , 2 0 2 1 , Mania Enterprises issued 1 2 % bonds dated

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