The following amortization and interest schedule reflects the issuance of 10-year bonds by Wildhorse Corporation on January 1, 2019, and the subsequent interest payments and charges. The company’s year-end is December 31, and financial statements are prepared once yearly.**Amortization Schedule:**| Year | Cash | Interest | Amount Unamortized | Carrying Value ||-----------|---------|----------|--------------------|----------------|| 1/1/2019 | | | $14,126 | $110,874 || 2019 | $12,500 | $13,305 | 13,321 | 111,679 || 2020 | 12,500 | 13,401 | 12,420 | 112,580 || 2021 | 12,500 | 13,510 | 11,410 | 113,590 || 2022 | 12,500 | 13,631 | 10,279 | 114,721 || 2023 | 12,500 | 13,767 | 9,012 | 115,988 || 2024 | 12,500 | 13,919 | 7,593 | 117,407 || 2025 | 12,500 | 14,089 | 6,004 | 118,996 || 2026 | 12,500 | 14,280 | 4,224 | 120,776 || 2027 | 12,500 | 14,493 | 2,231 | 122,769 || 2028 | 12,500 | 14,731 | | 125,000 |- **Carrying Value:** Represents the book value of the bond.- **Amount Unamortized:** Shows the remaining premium or discount on the bond.- **Interest:** Reflects the interest expense for the year.**Instructions:**a. Indicate whether the bonds were issued at a premium or a discount.[Click here to view factor tables.] The image contains a financial exercise for recording bond transactions. Here's a transcription and explanation suitable for an educational website:---**Indicate whether the amortization schedule is based on the straight-line method or the effective-interest method.**[Dropdown menu for selection]**Determine the stated interest rate and the effective-interest rate.**- The stated rate: [Input box] %- The effective rate: [Input box] %**Journal Entries:****d. On the basis of the schedule above, prepare the journal entry to record the issuance of the bonds on January 1, 2019.***(If no entry is required, select “No Entry” for the account titles and enter 0 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.)*| Date | Account Titles and Explanation | Debit | Credit ||--------------|--------------------------------|-------|--------|| January 1, 2019 | | | || | | | || | | | |**e. On the basis of the schedule above, prepare the journal entry or entries to record the bond transactions and accruals for 2019.***(Interest is paid January 1.) (If no entry is required, select “No Entry” for the account titles and enter 0 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.)*| Date | Account Titles and Explanation | Debit | Credit ||------|--------------------------------|-------|--------|| | | | || | | | || | | | |---This template guides users through determining interest rates and preparing journal entries using an amortization method. It provides structured input fields for comprehensive financial recording.

A bond represents a promise by a borrower to pay a lender their principal and usually interest on a…

Answered: b. Indicate whether the amortization…

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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On August 1, 2022, Bramble Corp. issued $482,400, 8%, 10-year bonds at face value. Interest is payable annually on August 1. Bramble’s year-end is December 31. 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 Aug. 1 enter an account title to record the issuance of the bonds on August 1 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds on August 1 enter a debit amount enter a credit amount eTextbook and Media List of Accounts Prepare the journal entry to record the accrual of interest on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31 enter an…
Question 5. On 1 January 2021 Corgi Ltd issued a £5m convertible bond at nominal value. There were no issue costs. The bond is redeemable at par on 1 January 2024 or bond holders can convert their bond into ordinary shares, with a nominal value of £1. The terms of the conversion are 2 shares for every £100 of bond. The coupon rate on the bond is 10%, payable annually in arrears. Bonds issued by similar entities without the conversion rights bear interest at 15%.
1. a) the amt of interest pd in cash every payment period, 1. b) the amt of amorization to be recorded at each interest payment date.(use the straight -line method
Subject: acounting
Blossom Company sold $3,300,000, 6%, 10-year bonds on January 1, 2022. The bonds were dated January 1, 2022 and pay interest annually on January 1. Blossom Company uses the straight-line method to amortize bond premium or discount. (a)
The balance sheet for Pina Colada Consulting reports the following information on July 1, 2022. Long-term liabilities Bonds payable Less: Discount on bonds payable $1,280,000 51,200 $1,228,800 Pina Colada decides to redeem these bonds at 105 after paying annual interest. Prepare the journal entry to record the redemption on July 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
3. No adjustment has yet been made for accrued interest receivable on a bondreceivable for the year ended December 31 2023. Regular interest payments aremade on February 28, May 31, August 31 and November 30 with interest revenuebeing recorded at the time of the payment. The balance of the bond receivableis $240,000 and the annual interest rate is 10%. The balance of the interestreceivable account is $2,000 which is unchanged from the previous year.I. Discuss how the above should be treated in the financial statements for theyear ended December 31 2023. i.e. explanation, workings and journal entries,where applicable.
On January 1, 2021, Madison Products issued $70 million of 6%, 10-year convertible bonds at a net price of $70.9 million. Madison recently issued similar, but nonconvertible, bonds at 99 (that is, 99% of face amount). The bonds pay interest on June 30 and December 31. Each $1,000 bond is convertible into 30 shares of Madison's no par common stock. Madison records interest by the straight-line method. On June 1, 2023, Madison notified bondholders of its intent to call the bonds at face value plus a 1% call premium on July 1, 2023. By June 30 all bondholders had chosen to convert their bonds into shares as of the interest payment date. On June 30, Madison paid the semiannual interest and issued the requisite number of shares for the bonds being converted. In this question, combine the discount on the bonds with the face amount, and record the net amount as bonds payable. This is the "net method." When the net method is used, the discount (or premium) is amortized directly to the bonds…
BOND PRICING #2 for Borrowing Money Inc Borrowing Money Inc (BMI) issues a bond on January 1, 2021 with a face valuc of $400,000. The bond has an 7 year maturity date and requires SEMI ANNUAL interest paymerits. The bond's stated interest rate is 3% and the current market interest rate is 2%. Hint: remember to set your expectations PV tables will be needed. Do not round your PVIF, but you may round answers to whole dollars. Prepare the journal entry (in proper form) at issuance of this bond for BMI. Include your journal for grading on your PDF upload. Your multiple step calculations must also be shown To get a preliminary idea of how you did you may enter your calculated amount for cash received at Issuance
2. complete the amoritzation table by calculating interest expense, beginning & ending bond carrying amounts at the end of each period, please show work & formulas used.
Crane Company issued $1,730,000 of bonds on January 1, 2022. (a) Prepare the journal entry to record the issuance of the bonds if they are issued at (1) 100, (2) 97, and (3) 105. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation (1) (2) (3) Debit Credit
Donna Clark Company issued $612,000 of 9%, 20-year bonds on January 1, 2025, at 101. Interest is payable semiannually on July 1 and January 1. Clark Company uses the straight-line method of amortization for bond premium or discount. Prepare the journal entries to record the following.

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