An entity issued ten-year P1,000,000 debenture bonds at the beginning of the current year. The bonds pay interest semiannually on June 30 and December 31. The entity used the effective interest method to amortize bond premium and discount. The carrying amount of the bonds on this date was P886,000. A journal entry was recorded for the first interest payment on June 30, debiting interest expense for P53,160 and crediting cash for P50,000. What is the annual stated interest rate for the debenture bond?

Q: On January 1, the first day of the fiscal year, a company issues a $650,000, 10%, 10-year bond that…

A: Bonds Payable: Bonds payable are generated when a company issues bonds to generate cash. As a bond…

Q: On the first day of the fiscal year, a company issues an $555,000, 8%, 5-year bond that pays…

A: Discount on bonds = Face value of the bonds - Issue price = $555,000 - $521,700 = $28,300

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A: Bond Premium is amortized can be amortized through Straight line method and Effective interest rate…

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A: Bonds are the form of loan or debt that is being issued by the company and on which regular interest…

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A: Premium on Bond Payable = $435,800 - $415,000 = $20,800   Interest is paid semiannually for 10…

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A: Journal entries refer to recording/ classifying the business transactions into books of accounts…

Q: 5M Corp. issued $100,000, 6%, 10 -year bonds payable on April 30 at 97. The bonds were authorized on…

A: Interest accrued = Face value of the bonds x interest rate x No. of months/ months= $100,000 x 6% x…

Q: On June 30, Jameson Company issued $2,500,000 of 10-year, 8% bonds, dated June 30, for $2,580,000.…

A: A BOND IS A DEBT SECURITY UNDER WHICH THE BOND ISSUER OWES THE BOND HOLDER A DEBT INCLUDING INTEREST…

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A: Bond is a financial instrument which is issued by the large organization to raise the funds. Bonds…

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A: A record is often kept in the general ledger, but it can also be kept in a single account,…

Q: On January 1, $925,000, 5-year, 10% bonds, were issued for $897,250. Interest is paid semiannually…

A:

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A: The bonds are the financial instruments that are used to raise money from the market or investors.

Q: Metlock, Inc. issued $282,000, 7%, 15-year bonds on December 31, 2021, for $253,800. Interest is…

A: Total discount on bonds = Face value of bonds - issue value of bonds = 282000-253800 = $28,200

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A: Bonds are debt instruments issued by organizations to raise funds to meet various requirements. The…

Q: On the first day of the fiscal year, a company issues an $302,000, 8%, 5-year bond that pays…

A: Under the straight line method of amortization, premium or discount of bond need to amortize equally…

Q: On January 1, the first day of the fiscal year, a company issues a $2,400,000, 4%, five-year bond…

A: Annual Interest=2,400,000×4%=96,000

Q: On the first day of the fiscal year, a company issues an $380,000, 7%, 5-year bond that pays…

A:

Q: On the first day of the fiscal year, a company issues an $988,000, 9%, five-year bond that pays…

A: On amortization of bond discount using the straight-line method, the discount is amortized…

Q: On the first day of the fiscal year, a company issues a $8,900,000, 8%, 5-year bond that pays…

A: Premium on bonds payable:  It occurs when the bonds are issued at a high price than the face value.

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A: Income statement is prepared with a view to ascertain the earnings of an entity over a specific…

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A: SOLUTION- Semiannual Amortization Amount= 904000 * 10% * 6/12= 45200

Q: On January 1, the first day of the fiscal year, a company issues an $1,350,000, 11%, five-year bond…

A: The process of recording business transactions in the books of accounts for the first time is…

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A: When the bonds are issued at par, the cash received is equal to the bond payable amount. When…

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A: The bonds payable are the financial instruments that are used to raise money from the market or…

Q: On the first day of the fiscal year, a company issues a (n) $935,000, 7%, 5-year bond that pays…

A: The objective of the question is to journalize the entry for the first interest payment and the…

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A: The amount of discount on the issue date is determined by deducting the selling value from the face…

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A: A per PFRS 9 Financial instruments an issue of bond is a financial liability which can be accounted…

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A: The accounting equation shows the equal balance of assets side and equity& liability side, it…

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A: Bonds payable are one of the sources of finance and are shown as liability. If the interest rate is…

Q: Diaz Company issued bonds with a face value of $127,000 on January 1, Year 1. The bonds had a stated…

A: As you have asked multiple sub-parts we can solve only first three sub-parts for you please repost…

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A: The objective of the question is to record the issuance of the bonds and the first two interest…

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.