**Bond Issuance and Journalization Overview**Ari Goldstein, Inc. issued $500,000 of 7%, 12-year bonds payable on January 1, 2018. The market interest rate at the date of issuance was 6%, and the bonds pay interest semiannually.- **Tools for Calculation:** - Present Value of $1 table - Present Value of Ordinary Annuity of $1 table - Future Value of $1 table - Future Value of Ordinary Annuity of $1 table**Requirements:**1. **Calculating Issuance Cash:** - Determine the cash received upon issuance of the bonds payable. Round to the nearest dollar.2. **Amortization Table Preparation:** - Prepare an amortization table for the bond using the effective-interest method, covering the first two interest payments. Round to the nearest dollar.3. **Journalization:** - Journalize the issuance of the bonds on January 1, 2018, along with the first and second payments of the semiannual interest amount and amortization of the bonds on June 30, 2018, and December 31, 2018. Note that explanations are not required.**Important Considerations:**- Use factor tables with factors rounded to three decimal places.- Round all currency amounts to the nearest dollar.- Capture the financial implications effectively in journal entries and ensure compliance with accounting standards.This information is presented to facilitate understanding the bond issuance process, including cash flow analysis, amortization, and journalization specific to the scenario provided.

Bonds are the fixed income securities used by a corporation to issue debt in market for the purpose…

Ari Goldstein, Inc. issued $500,000 of 7%, 12-year bonds payable on January 1, 2018. The market interest rate at the date of issuance was 6%, and the bonds pay interest semiannually. ( Click the icon to view Present Value of Ordinary Annuity of $1 table.) (Click the icon to view Future Value of Ordinary Annuity of $1 table.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Future Value of $1 table.) Requirements (Use the factor tables provided with factors rounded to thre- 1. How much cash did the company receive upon issuance of the bonds payable? (Round to the nearest dollar.) 2. Prepare an amortization table for the bond using the effective-interest method, through the first two interest payments. (Round to the nearest dollar.) 3. Journalize the issuance of the bonds on January 1, 2018, and the first and second payments of the semiannual interest amount and amortization of the bonds on June 30, 2018, and December 31, 2018. Explanations are not required.

Ari Goldstein, Inc. issued $500,000 of 7%, 12-year bonds payable on January 1, 2018. The market interest rate at the date of issuance was 6%, and the bonds pay interest semiannually. ( Click the icon to view Present Value of Ordinary Annuity of $1 table.) (Click the icon to view Future Value of Ordinary Annuity of $1 table.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Future Value of $1 table.) Requirements (Use the factor tables provided with factors rounded to thre- 1. How much cash did the company receive upon issuance of the bonds payable? (Round to the nearest dollar.) 2. Prepare an amortization table for the bond using the effective-interest method, through the first two interest payments. (Round to the nearest dollar.) 3. Journalize the issuance of the bonds on January 1, 2018, and the first and second payments of the semiannual interest amount and amortization of the bonds on June 30, 2018, and December 31, 2018. Explanations are not required.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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How to calculate the issue price of the bonds with normal calculator?