Aylmer follows IFRS On January 1, 2015, Aylmer issued $400,000 12 % 10-year bonds. Interest is paid on an annual basis. The bonds were issued for investors to have a yield of 7%. Because of the high interest rate, Aylmer decided to call the bonds on December 31, 2021 at 115. No entries were made in 2021 in respect to this bond (interest is owed for 2021 since the bonds were outstanding for 2021) NOTE - the amount on the trial balance ($467,744) is your check number for the amortization schedule at December 31, 2020 - BEFORE ADJUSTMENTS and 2021 Interest payment. In the Excel spreadsheet, see the tab labelled "Bonds Payable - Series 1" Required: a) Determine the carrying value b) create the amortization schedule c) complete the journal entries for the year end, 2021

Aylmer follows IFRS On January 1, 2015, Aylmer issued $400,000 12 % 10-year bonds. Interest is paid on an annual basis. The bonds were issued for investors to have a yield of 7%. Because of the high interest rate, Aylmer decided to call the bonds on December 31, 2021 at 115. No entries were made in 2021 in respect to this bond (interest is owed for 2021 since the bonds were outstanding for 2021) NOTE - the amount on the trial balance ($467,744) is your check number for the amortization schedule at December 31, 2020 - BEFORE ADJUSTMENTS and 2021 Interest payment. In the Excel spreadsheet, see the tab labelled "Bonds Payable - Series 1" Required: a) Determine the carrying value b) create the amortization schedule c) complete the journal entries for the year end, 2021

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 7MCQ

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Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018, and received $540,000. Interest is payable semi-annually. The premium is amortized using the straight-line method. Prepare journal entries for the following transactions. 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
On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated interest rate of 12% payable semi-annually on July 1 and January 1. The bonds were sold to yield 10%. Assuming the bonds were sold at 107.732, what is the selling price of the bonds? Were they issued at a discount or a premium?
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Naval Inc. issued $200,000 face value bonds at a discount and received $190,000. At the end of 2018, the balance in the Discount on Bonds Payable account is $5,000. This years balance sheet will show a net liability of ________. A. $200,000 B. $180,000 C. $195,000 D. $205,000
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