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Homework answers / question archive / On January 1, 2021, Darnell Window and Pane issued $18

On January 1, 2021, Darnell Window and Pane issued $18

Accounting

On January 1, 2021, Darnell Window and Pane issued $18.5 million of 10-year, zero-coupon bonds for $6,515,413. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

 

Required:

2. Determine the effective rate of interest.

1. & 3. to 5. Prepare the necessary journal entries.

 

 

Interest rate

%

 

  • Record the issuance of the bonds.

Note: Enter debits before credits.

 

 

 

 

DateGeneral JournalDebitCreditJanuary 01, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  • Record annual interest expense at December 31, 2021.

Note: Enter debits before credits.

 

 

 

 

DateGeneral JournalDebitCreditDecember 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  • Record annual interest expense at December 31, 2022.

Note: Enter debits before credits.

 

 

 

 

DateGeneral JournalDebitCreditDecember 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  • Record the payment at the bonds' maturity.

Note: Enter debits before credits.

 

 

 

 

DateGeneral JournalDebitCreditDecember 31, 2030

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