Prepare the company december adjusting entry

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Question - On January 1, 2020, Ayayai Corporation issued $550,000 of 5% bonds that are due in 9 years. The bonds were issued for $445,560 and pay interest each July 1 and January 1. The company uses the effective interest method. Assume an effective rate of 8%.

Required -

a) Prepare the company's journal entry for the January 1 issuance.

b) Prepare the company's journal entry for the July 1 interest payment.

c) Prepare the company's December 31 adjusting entry.

d) Prepare the first three payments of an effective interest amortization table for the bonds.

Reference no: EM133115210

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