Question

On January 1, 2004, $100,000,000 in 7.5%, 10-year callable bonds were issued at 96.64% to yield an effective rate of 8.0%. Callable at 103; interest paid annually on January1.

If the bonds are called on April 1, 2006, what are the needed payments and entries to extinguish the bonds? Assume that no entries have been made since the January 1, 2006 interest payment.

Answer 1

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