Universal Foods issued 10% bonds, dated January 1, with a face
amount of $172 million on January 1, 2021 to Wang Communications.
The bonds mature on December 31, 2035 (15 years). The market rate
of interest for similar issues was 12%. Interest is paid
semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA
of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use
appropriate factor(s) from the tables provided.)
1. to 3. Prepare the journal entries to record the purchase of the bonds by Wang Communications on January 1, 2021, interest revenue on June 30, 2021 and interest revenue on December 31, 2028. (Round final answers to the nearest whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
formulas used to calculate the value of the bond:-
Value of the Bond Today=-PV(E26,E25,E24,E23)
i hope my efforts will be fruitful to you....
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