Prepare journal entries for the following four events (use straight-line amortization). 01/01/07 The Def Co. issued $100,000, five year bonds, carrying a coupon rate of ten percent (10%), interest payable annually on December 31 each year. Assume that the net proceeds from the issue of the bond were $2,000 different from the face value. The market rate of interest at the time of issue was nine percent(9%).

12/31/07 Recognize the first interest payment.

12/31/08 Recognize the second interest payment.

01/01/09 Redeem (i.e., buy back) twenty percent (20%) of the bonds outstanding for $19,500.

Answer rating: 100% (QA)

Answer The Def Co All Amounts in Journal Entries Date View the full answer