Answer Happy

2. Jaguar Corporation issues bonds with a face value of $300,000 on January 1. The 4-year bonds have a stated rate of 7% interest. They pay interest annually on December 31. The market rate or effective rate on the date of issuance was 9% a. Calculate how much investors would be willing to pay for the bonds. b. Create the journal entries to record the issuance at the effective interest rate of 9%. c. Create the journal entries to record payment of interest on December 31. 5 3. Ribbon Enterprises sells computers with an embedded 2-year warranty. They also offered an extended warranty for the 3rd year, for $10. In 2014, Ribbon sold 3,000 computers for $400 each, with 50 customers purchasing the 3rd year extended warranty. Ribbon estimates that 4 percent will need to be repaired at an average cost of $20 each. In 2015, repairs in the amount of $2,500 were made. In the 3rd year, $260 of repairs were made. Make the following journal entries: a. to record the sale of the computers b. to record the embedded & extended warranties c. to record all of the repairs