Universal Foods issued 8% bonds, dated January 1, with a face amount of $130 million on January 1, 2024. .The bonds mature on December 31, 2038 (15 years). The market rate of interest for similar issues was 10%. • Interest is paid semiannually on June 30 and December 31. • Universal uses the straight-line method. Required: 1. Determine the price of the bonds at January 1, 2024. 2. to 4. Prepare the journal entries to record their issuance by Universal Foods on January 1, 2024, interest on June 30, 2024 and interest on December 31, 2031. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

Universal Foods issued 8% bonds, dated January 1, with a face amount of $130 million on January 1, 2024. .The bonds mature on December 31, 2038 (15 years). The market rate of interest for similar issues was 10%. • Interest is paid semiannually on June 30 and December 31. • Universal uses the straight-line method. Required: 1. Determine the price of the bonds at January 1, 2024. 2. to 4. Prepare the journal entries to record their issuance by Universal Foods on January 1, 2024, interest on June 30, 2024 and interest on December 31, 2031. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 6PA: Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...

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