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On Jan 1, 2016, Trapp Enterprises issued 9%, 10-year bonds with a face amount of...

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Accounting

On Jan 1, 2016, Trapp Enterprises issued 9%, 10-year bonds with a face amount of $900000 at 96. Interest is payable annually on Jan 1. The bonds were issued for an effective interest rate of 10%.

Prepare the entries to record the issuance of the bonds and the first annual interest accural and amortization assuming that the company uses effective-interest amortization.

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