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Practice Inc

Question 81

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Practice Inc.issued a $10 million bond due in five years,and the bond indenture specifies that the company must set aside $2 million per year in a sinking fund so that the company will have funds to repay the bondholders at the end of 5 years.Assuming that the Practice Inc.complies with the contractual requirements,what would be the journal entries for each of the 5 years?

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