Response to the following problem:
Hic-Tec Co. produces and distributes fiber-optic cable for use by telecommunications companies. Hic-Tec Co. issued $10,000,000 of 20-year, 9% bonds on April 1 of the current year, with interest payable on April 1 and October 1. The fiscal year of the company is the calendar year.
Record the entries for the following selected transactions for the current year:
Apr. 1 Issued the bonds for cash at their face amount.
Oct. 1 Paid the interest on the bonds.
Dec. 31 Recorded accrued interest for three months.