On January 1, 2013, JetNew, Issued $1,000,000 Face Value, 5-Year

question 89

Essay

On January 1, 2013, JetNew, issued $1,000,000 face value, 5-year bonds with a stated rate of 5% at an effective rate of 4% which brought in $1,044,913. Interest is paid semi-annually on July 1 and December 31. JetNew uses the effective-interest method of amortization.
Prepare entries for the following transactions:
a. Issuance of the bonds on January 1, 2013.
b. Payment of interest and amortization of discount or premium on July 1, 2013.

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Definitions:

Maintenance Behavior

Actions taken to preserve and sustain desired conditions or states in various contexts, including personal well-being, relationships, and physical assets.

Change-Oriented Behavior

Actions and activities that individuals or groups undertake with the intention of bringing about alteration in the current state of affairs or status quo.

Encouraging Innovation

Promoting and supporting new ideas, methods, and approaches to solve problems or create value.

Taxonomies

are systems of classification that organize concepts, objects, or information into categories based on common characteristics, widely used in biology, information science, and other fields.