Problem:
On January 1st of 2012 P&P products purchased 1,000,000 of 8%, 5 year A&A product bonds on the open market for 960,000. The bonds are dated and were issued by A&A products on January 1st 2010. The bonds pay interest each January 1st and July 1st. The effective interest method is used.
Requirement:
Question: Make any necessary entries for A&A products,
Note: Explain all calculation and formulas.