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Prepare the journal entry for the redemption of the bonds

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Reference no: EM132701265

On January 1, 2021, Oriole Ltd. issued bonds with a maturity value of $6,900,000 when the market rate of interest was 4%. The bonds have a coupon (contractual) interest rate of 5% and mature on January 1, 2031. Interest on the bonds is payable semi-annually on July 1 and January 1 of each year. The company's year-end is December 31.

Question 1: Record the payment of interest on January 1, 2022.

Question 2: The bonds were redeemed on January 1, 2023 (after the interest had been paid and recorded) at 102. Prepare the journal entry for the redemption of the bonds.

Reference no: EM132701265

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