Federal semiconductors issued 13 bonds dated january 1 with, Ask an Expert

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Federal Semiconductors issued 13% bonds, dated January 1, with a face amount of $690 million on January 1, 2016. The bonds sold for $644,005,394 and mature on December 31, 2035 (20 years). For bonds of similar risk and maturity the market yield was 14%. Interest is paid semiannually on June 30 and December 31.

Required: 1. to 3. Prepare the journal entry to record their issuance by Federal on January 1, 2016, interest on June 31, 2016 (at the effective rate) and interest on December 31, 2016 (at the effective rate). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)

1. Record the issuance of the bond on January 1, 2016.

2. Record the interest on June 30, 2016 (at the effective rate)

3. Record the interest on December 31, 2016 (at the effective rate).

4. At what amount will Federal report the bonds among its liabilities in the December 31, 2016, balance sheet? (Enter your answers in whole dollars.)

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Financial Accounting, Accounting

Category:- Financial Accounting
Reference No.:- M91962441

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