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    Accounting Journal Entries

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    On January 1, Flory Company issued $300,000, 8%, 5-year bonds at face value. Interest is payable semiannually on July 1 and January 1.
    Prepare journal entries to record the following events.

    The issuance of the bonds.
    Date Account/Description Debit Credit
    Jan. 1

    The payment of interest on July 1, assuming no previous accrual of interest.
    Date Account/Description Debit Credit
    July 1

    The accrual of interest on December 31.
    Date Account/Description Debit Credit
    Dec. 31

    Leoni Co. receives $240,000 when it issues a $240,000, 10%, mortgage note payable to finance the construction of a building at December 31, 2011. The terms provide for semiannual installment payments of $20,000 on June 30 and December 31.
    Prepare the journal entries to record the mortgage loan and the first two installment payments.

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    Accounting journal entries are examined.