On the First Day of the Fiscal Year, a Company

question 37

Essay

On the first day of the fiscal year, a company issues a $1,000,000, 7%, 5-year bond that pays semiannual interest of $35,000 ($1,000,000 × 7% × 1/2), receiving cash of $884,171. Journalize the first interest payment and the amortization of the related bond discount using the straight-line method. Round answers to the nearest dollar.

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Definitions:

Vladimir Lenin

Vladimir Lenin was a Russian revolutionary leader and political theorist who led the Bolshevik Party to power in the October Revolution of 1917, becoming the founding head of the Soviet State.

Kornilov Affair

A failed coup attempt in 1917 by General Lavr Kornilov, aimed at establishing a military dictatorship in Russia during the turbulent period following the February Revolution.

Bolshevik Influence

The effect or impact of the Bolshevik party's ideologies and policies, particularly in relation to the Russian Revolution and the early Soviet Union.

Counter-Revolution

An effort or movement to reverse the changes introduced by a previous revolution or to restore the state of affairs that existed before those changes.