Response to the following :
Refer to the information in problem 1. Prepare the journal entry on June 30 for Gatrong to record the first interest receipt, using the effective interest method. Round to the nearest dollar.
Problem 1:
On January 1, Year 1, the Gatrong Corporation purchased 12%, five-year Fleming Corporation bonds with a face value of $200,000. It expects to hold these bonds until maturity. The bonds pay interest semiannually on June 30 and December 31. Gatrong paid $215,443, a price that yields a 10% effective annual interest rate. Prepare the journal entry of Gatrong to record the purchase of the bonds.