ORIE 3150 Homework _6 Fall 2009 - ORIE 3150 Homework #6 Do...

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ORIE 3150 Homework #6 Do for October 22, 2009 1. On January 1, 2009, Liquidia Corporation issued a $10,000,000 face value bond with 10% face interest rate and a maturity of 15 years. The semi-annual interest payments are made on June 30 and December 31. The bond was issued at such a price as to yield 9.875%. a. What was the issue price of the bond? b. Prepare the journal entry to record the sale of the bond. c. Prepare the journal entries to record the payment of interest and amortization on June 30, 2009 and December 31, 2009. Use the effective interest method. 2. On January 1, 2009, Rockpit Corporation issued a $10,000,000 face value bond with 9% face interest rate and a maturity of 10 years. The semi-annual interest payments are made on June 30 and December 31. The bond was issued at such a price as to yield 9.25%. a. What was the issue price of the bond? b. Prepare the journal entry to record the sale of the bond. c. Prepare the journal entries to record the payment of interest and amortization on
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ORIE 3150 Homework _6 Fall 2009 - ORIE 3150 Homework #6 Do...

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