On January 1, 2019, Simmons Company sold a $100,000 issue of its ten-year, 6% bonds...
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Accounting
On January 1, 2019, Simmons Company sold a $100,000 issue of its ten-year, 6% bonds payable. The bonds were sold to yield the market rate at the time of sale which was 4%. The bonds were dated January 1, 2019 and pay interest semiannually on each June 30 and each December 31. The effective interest method is used for amortization and no adjusting journal entries are made during the year. A. Prepare the journal entry for the sale of the bonds. B. Prepare the journal entry to record the first interest payment and include the appropriate date for the entry. C. Prepare the journal entry to record the second interest payment and include the appropriate date for the entry. Note: Present value tables can be found at the end of the exam booklet
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