On January 1, 2018, Varden Ltd. issued $4,000,000, 10% bonds, which mature on January 1,...
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On January 1, 2018, Varden Ltd. issued $4,000,000, 10% bonds, which mature on January 1, 2028. The bonds were issued for $4,540,000 to yield 8%. Varden uses the effective-interest method of amortizing bond premium. Interest is payable annually on December 31. At December 31, 2018, the adjusted balance in the Bonds Payable account should be
a) $4,540,000. b) $4,503,200. c) $4,486,000. d) $4,000,000.
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