problem: A company issued nine percent, ten year bonds with a par value of USD 1,000,000 on Sept 1, 2007 when the market rate was 9 percent. The bonds were dated June 30, 2007. The bond issue price included accrued interest. Interest paid semiyearly on Dec 31 and June 30.
[A] Make an issuer’s journal entry to record the issuance of the bonds.
[B] Make an issuer’s journal entry to record semiannual interest payment on Dec 31, 2007.