Ajax issued $2,500,000 in bonds on January 1, 2014 at a stated rate of 4% and a yield of 5%. Interest is due on June 30th and December 31st of each bond matures on December 31, 2015. 1. Prepare a journal entry for the issuance of the bonds on January 1, 2014. 2. Prepare a journal entry for the payment of interest on June 30, 2014. 3. Prepare a journal entry for the retirement of the bonds at maturity. year and the
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- On January 1, 2018, Parker Company issued bonds with a face value of $63,000, a stated rate of interest of 12 percent, and a five-year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 14 percent at the time the bonds were issued. The bonds sold for $58,674. Parker used the effective interest rate method to amortize the bond discount cash payment interest expense discount amortization carrying value jan 1 2018 58764 dec 31 2018 7560 8214 654 59329 dec 31 2019 dec 31 2020 dec 31 2021 dec 31 2022 totals 37800 42126 4326On January 1, 2016, Knorr Corporation issued $1,000,000 of 9%, 5-year bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 10%. Bond issue costs associated with the bonds totaled $18,000. Required: Prepare the journal entries to record the following: January 1, 2016 Sold the bonds at an effective rate of 10% December 31, 2016 First interest payment using the effective interest method December 31, 2016 Amortization of bond issue costs using the straight-line method December 31, 2017 Second interest payment using the effective interest method December 31, 2017 Amortization of bond issue costs using the straight-line methodOn January 1, 2021, Bradley Recreational Products issued $100,000, 9%, four year bonds. Interest is paid semiannually on June 30 and December 31. The market yield for bond of similar risk and maturity is 7%. The fiscal year for the firm ends on December 31. A. Determine the price of the bonds issued on January 1. B. Prepare the amortization schedule for the bonds using the effective interest rate method. C. Prepare the journal entries to record: • Issuing bonds on January 1 • Paying interest on June 30, 2021 • Paying interest on Dec 31, 2021 • Repayment of the bonds on December 31, 2025.
- Ivanhoe Company issued $459,000, 8%, 30-year bonds on January 1, 2017, at 103. Interest is payable annually on January 1. Ivanhoe uses straight-line amortization for bond premium or discount.Prepare the journal entries to record the following events. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) (a) The issuance of the bonds. (b) The accrual of interest and the premium amortization on December 31, 2017. (c) The payment of interest on January 1, 2018. (d) The redemption of the bonds at maturity, assuming interest for the last interest period has been paid and recorded. No. Date Account Titles and Explanation Debit Credit (a) Jan. 1, 2017 enter an account title to record the issuance of the bonds on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds on January 1, 2017 enter a debit amount…Stephanie Ram Corporation have a $880,000 "bond issue" dated February 1, 2016 due in 10 years with an annual interest rate of 12%. Interest is payable February 1 and August 1. On April 1, 2016, the bond was sold for $826,900 plus accrued interest. Using the straight-line method, prepare the general journal entries for each of the following: a) The issuance of the bond on April 1, 2016. b) Payment of the semi-annual interest and the amortization of the discount on August 1, 2016. c) Accrual of the interest and the amortization of the discount on December 31, 2016. d) Payment of the semi-annual interest and the amortization of the discount on February 1, 2017. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Do not use dollar signs ($) when entering amounts. To see comma-formatted numbers reflected in your final answers, you must enter your answers with commas. Round answers to 2 decimal places, eg. 5,275.25.) Date Account Titles and…Adcock Company issued $276,000, 8%, 20-year bonds on January 1, 2015, at 105. Interest is payable semiannually on July 1 and January 1. Adcock uses straight-line amortization for bond premium or discount. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1, 2015 Prepare the journal entry to record the payment of interest and the premium amortization on July 1, 2015, assuming that interest was not accrued on June 30. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit July 1, 2015 Prepare the journal entry to record the accrual of…
- Pharoah Company issued $2,400,000 of 10%, 10-year bonds on January 1, 2017, at 104. Interest is payable semiannually on July 1 and January 1. Pharoah Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.3750%.Prepare the journal entries to record the following. The issuance of the bonds.(b)The payment of interest and related amortization on July 1, 2017.(c)The accrual of interest and the related amortization on December 31, 2017.solve(b) Prepare an effective-interest amortization table for the first eight interest payments for these bonds. (c) The Bonds were redeemed on January 1, 2026 (after the interest had been paid and recorded) at 102. Prepare the journal entry for the redemption of the bonds.
- The Pearl Company issued $240,000 of 10% bonds on January 1, 2025. The bonds are due January 1, 2030, with interest payable each July 1 and January 1. The bonds are issued at face value. Prepare Pearl's journal entries for (a) the January issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) No. (a) (b) (c) Date Account Titles and Explanation Debit CredThe following investment portfolio of equity securities (all acquired during 2021) accounted for as fair value through other comprehensive income are held by GHI Company on December 31, 2021: Investment Acquisition Cost P3,300,000 HJK, Inc. shares (1,100 shares) Fair value, 12/31/21 P3,100/share 9/share 225/share LMN Co. shares (35,000 shares) OPQ Corp. shares (12,000 shares) 350,000 2,400,000 The following transactions occurred during 2022: • A 20% stock dividend was declared and issued on the HJK, Inc. shares, after which the company sold 330 shares at its fair value of P2,700/share. Additional 5,000 shares of LMN Co. were purchased by the company during the year at fair value of P9.50/share, excluding P0.50/share transaction costs. LMN Co. then declared and paid a P2/share cash dividend. ● A 2-for-3 split was declared by OPQ Corp. to reduce its number of shares. OPQ Corp. declared and paid a P3/share cash dividend after the split. The fair value of the equity securities at year-end…Aggies Inc. issued bonds with a $450,000 face value, 8% interest rate, and a 4-year term on July 1, 2018, and received $510,000. Interest is payable semi-annually. The premium is amortized using the straight-line method. A. July 1, 2018: entry to record issuing the bonds B. Dec. 31, 2018: entry to record payment of interest to bondholders C. Dec. 31, 2018: entry to record amortization of premium Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank. A. fill in the blank 2 fill in the blank 3 fill in the blank 5 fill in the blank 6 fill in the blank 8 fill in the blank 9 B. fill in the blank 11 fill in the blank 12 fill in the blank 14 fill in the blank 15 C.