On October 1, 20×7, Winston Corporation issued $250,000 of 9 percent bonds at 96. The bonds are dated October 1 and pay interest semiannually. The market rate of interest is 10 percent, and the company’s yearend is December 31. Prepare the entries to record the issuance of the bonds, the accrual of the interest on December 31, 20×7, and the payment of the first semiannual interest on April 1, 20×8. Assume the company uses the effective interest method to amortize the bond discount.
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On October 1, 20×7, Winston Corporation issued $250,000 of 9 percent bonds at 96. was first posted on June 29, 2020 at 1:09 am.
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