Universal Foods issued 14% bonds, dated January 1, with a face amount of $145 million on...

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Universal Foods issued 14% bonds, dated January 1, with a faceamount of $145 million on January 1, 2018 to Wang Communications.The bonds mature on December 31, 2032 (15 years). The market rateof interest for similar issues was 16%. Interest is paidsemiannually on June 30 and December 31. Universal uses thestraight-line method. Universal Foods sold the entire bond issue toWang Communications. (FV of $1, PV of $1, FVA of $1, PVA of $1,FVAD of $1 and PVAD of $1) (Use appropriate factor(s) fromthe tables provided.)

Required:
1-3. Prepare the journal entry to record thepurchase of the bonds by Wang Communications on January 1, 2018,interest revenue on June 30, 2018 and interest revenue on December31, 2025. (Enter your answers in whole dollars. If no entryis required for a transaction/event, select "No journal entryrequired" in the first account field.)

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1 Entry at the time of Purchase of Bonds on January 1 2018 by Wang Communications Bonds Receivable Ac Dr 145 million To Discount Received on Bonds Ac Cr 1632 million To CashBank Ac Cr 12868 million Here bonds are issued at 14 coupon rate which is lesser than market interest rate of 16 Thus bonds are said to be issued on discount Thus at the time of purchase ie See Answer

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Universal Foods issued 14% bonds, dated January 1, with a faceamount of $145 million on January 1, 2018 to Wang Communications.The bonds mature on December 31, 2032 (15 years). The market rateof interest for similar issues was 16%. Interest is paidsemiannually on June 30 and December 31. Universal uses thestraight-line method. Universal Foods sold the entire bond issue toWang Communications. (FV of $1, PV of $1, FVA of $1, PVA of $1,FVAD of $1 and PVAD of $1) (Use appropriate factor(s) fromthe tables provided.)Required:1-3. Prepare the journal entry to record thepurchase of the bonds by Wang Communications on January 1, 2018,interest revenue on June 30, 2018 and interest revenue on December31, 2025. (Enter your answers in whole dollars. If no entryis required for a transaction/event, select "No journal entryrequired" in the first account field.)