Prepare the journal entries for the issuance of the bonds in both 1 and 2. assume that both bonds are issued for cash on january 1, 2013.
1. enviro company issues 8%, 10-year bonds with a par value of $250,000 and semiannual interest payments. on the issue date, the annual market rate for these bonds is 10%, which implies a selling price of 87 1/2. the straight-line method is used to allocate interest expense.
2. garcia company issues 10%, 15-year bonds with a par value of $240,000 and semiannual interest payments. on the issue date, the annual market rate for these bonds is 8%, which implies a selling price of 117 1/4 . the effective interest method is used to allocate interest expense.

Transactions that affect earnings do not necessarily affect cash. identify the effect, if any, that each of the following transactions would have upon cash and net income. the first transaction has been completed as an example. (if an amount reduces the account balance then enter with negative sign preceding the number e.g. -15,000 or parentheses e.g. (15, cash net income (a) purchased $120 of supplies for cash. –$120 $0 (b) recorded an adjustment to record use of $35 of the above supplies. (c) made sales of $1,370, all on account. (d) received $700 from customers in payment of their accounts. (e) purchased equipment for cash, $2,450. (f) recorded depreciation of building for period used, $740. click if you would like to show work for this question: open show work