Question

Prepare the journal entries at the time of issuance, at the end of years 1, 2,...

Prepare the journal entries at the time of issuance, at the end of years 1, 2, and
3 for the issuance of a three year bond. The bond has the face value of $1,000,000, a
stated coupon rate of 5% and a market rate of 3%. Cash coupon interest payments are
made at the end of years 1, 2, and 3.

Debit Credit

a. (6 points) Journal entry at issuance

b. (6 points) Journal entry at end of year 1

c. (6 points) Journal entry at end of year 2

d. (6 points) Journal entry at end of year 3

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