Pizza Pier Issues 7%,10-Year Bonds with a Face Amount of $80,000

question 142

Essay

Pizza Pier issues 7%,10-year bonds with a face amount of $80,000 for $85,951 on January 1,2012.The market interest rate for bonds of similar risk and maturity is 6%.Interest is paid semiannually on June 30 and December 31.
1.Record the bond issue.
2.Record the first interest payment on June 30,2012.

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Definitions:

Commercial Property

Real estate property that is used for business activities, such as offices, retail spaces, warehouses, and industrial buildings.

Residential Property

Real estate that is used for housing or dwelling purposes.

Special Deterrence

A principle in criminal justice aiming to prevent a particular offender from committing future crimes by imposing a penalty for their actions.

Fifth Amendment

An amendment to the U.S. Constitution that provides several protections to individuals, including rights against self-incrimination, double jeopardy, and guarantees due process of law.