On June 1,2014,Minute Controls,Inc

question 31

Essay

On June 1,2014,Minute Controls,Inc.issued $12,000,000 of 10 percent bonds to yield 12 percent.Interest is payable semiannually on May 31 and November 30.The bonds mature in 15 years.Minute Controls,Inc.is a calendar-year corporation.
(1)Determine the issue price of the bonds.Show computations.
(2)Prepare an amortization table through the first two interest periods using the effective-interest method.
(3)Prepare the journal entries to record bond-related transactions as of the following dates:
(a)June 1,2014
(b)November 30,2014
(c)December 31,2014
(d)May 31,2015

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Definitions:

GATT

The General Agreement on Tariffs and Trade, an international treaty designed to promote international trade by reducing or eliminating trade barriers.

Covering Law

In the philosophy of science, a general law that 'covers' or explains a set of phenomena, making them predictable and understandable.

Normative Principle

A standard or rule that guides ethical or moral behavior, prescribing how individuals ought to act in given situations.