Mcgee company issued 400000 of 8 20-year bonds on january 1, Financial Accounting

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Mcgee company issued 400000 of 8 20-year bonds on january 1

McGee Company issued $400,000 of 8%, 20-year bonds on January 1, 2014, . Interest is payable semiannually on July 1 and January 1. McGee Company uses the effective interest method of amortization for bond premium or discount.

Assume an effective yield of 6% in pricing the bond.

Instructions

Calculate the price of the bond

Prepare the first 4 periods of amortization schedule

Prepare the journal entries to record the following. (Round to the nearest dollar)

(a) The issuance of the bonds.

(b) The payment of interest and the related amortization on July 1, 2014

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Financial Accounting: Mcgee company issued 400000 of 8 20-year bonds on january 1

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Financial Accounting: Mcgee company issued 400000 of 8 20-year bonds on january 1

Reference No:- TGS01659617

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