Berry Co. issued P800,000 of 12% face value bonds for P851,706. The bonds which were dated and issued on April 1, 2017, are due March 31, 2021, and pay interest semiannually on September 30 and March 31. The company sold the bonds to yield 10%. How much is carrying value of the bonds payable as of December 31, 2017?

Berry Co. issued P800,000 of 12% face value bonds for P851,706. The bonds which were dated and issued on April 1, 2017, are due March 31, 2021, and pay interest semiannually on September 30 and March 31. The company sold the bonds to yield 10%. How much is carrying value of the bonds payable as of December 31, 2017?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On March 1, 2018, Baddour, Inc., issued 12% bonds, dated January 1, with a face amount of $161 million. The bonds were priced at $140.7 million (plus accrued interest) to yield 14%. Interest is paid semiannually on June 30 and December 31. Baddour’s fiscal year ends September 30. Do not give answer in image
On January 1, 2021, Solo Inc. issued 1,300 of its 8%, $1,000 bonds at 97.7. Interest is payable semiannually on January 1 and July 1. The bonds mature on January 1, 2031. Solo paid $51,000 in bond issue costs. Solo uses straight-line amortization. What is the carrying value of the bonds reported in the December 31, 2021, balance sheet?
On October 1, 2015, Redoubtable Corp. issued 5%, 10-year bonds with a face value of $3,000,000 at 104%. On October 1 and April 1, interest is paid. Any premiums or discounts are amortized on a straight-line basis. If you were preparing Redoubtable Corporation’s income statement for December 31, 2015, what bond interest expense would you report?
Stafford Co. Issued $200,000 face value, 6%, 10-year bonds on January 1, 2017 for $172,740. The market rate of interest was 8%. Interest is payable semi-annually on June 30 and December 31. Staffer uses the effective interest method to amortize bond premium or discount. (a) Determine the amount of interest expense to be recorded with the first cash interest payment. (b) Determine the carrying value of the bonds on December 31, 2017, after the interest payment has been made. (c) How much interest expense would be recorded on the 2017 Income Statement?
On January 1, 2017, Babb Trailers, Inc. issued $6,500,000 of par value bonds for $6,200,000. The bonds pay interest semiannually on January 1 and July 1. The contract rate of interest is 3% while the market rate of interest for similar bonds is 5%. The bond premium or discount is being amortized at a rate of $10,000 every six months. The carrying value on January 2, 2019 is
The Colson Company issued 300,000 of 10 % bonds on January 1, 2017. The bonds are due January 1, 2022, with interest payable each July 1 and January 1. The bonds are issued at face value. Prepare Colson’s journal entries for (a) the January issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry.
On January 1, 2015, ABC Co. issued ten-year bonds with a face value of $1,000,000 and a stated interest rate of 10%, payable annually on January 1. The bonds were sold to yield 12%. The issue price of the bonds was $886,996 On October 31, 2017, the company decided to extinguish 55% of the bonds by making a cash payment of $520,000. The cash payment includes any accrued interest by the date of extinguishment. The company uses the effective-interest method of amortization. Required: For ABC Co: Prepare the necessary journal entry(ies) on September 30, 2016. SHARE
On January 1, 2017, Satin Corp. issued eight-year, 6% bonds with a face value of $500,000, with interest payable annually on December 31. The bonds were sold to yield 8%. The bond issuance costs were $5,000. The bonds payable liability will initially be recorded at: A) $447,534. B) $437,534. OC) $442,534. OD) $500,000.
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.
On July 1, 2021, Spear Co. issued 1,000 of its 10%, P1,000 bonds at 99 plus accrued interest. The bonds are dated April 1, 2015 and mature on April 1, 2031. Interest is payable semiannually on April 1 and October 1. What amount did Spear receive from the bond issuance? a.) P1,015,000 b.) P1,000,000 c.) P990,000 d.) P965,000
On January 1, 2006, Carrow Company issued its 10% bonds in the face amount of P1,000,000 that mature on January 1, 2016. The bonds were issued for P886,000 to yield 12%, resulting in bond discount of P114,000. Carrow uses the interest method of amortizing bond discount. Interest is payable July and January 1. For the year ended December 31, 2006, Carrow should report bond interest expense at
Wildhorse Co. issued 10%, 6-year, $2,739,400 par value bonds that pay interest semiannually on October 1 and April 1. The bonds are dated April 1, 2017, and are issued on that date. The discount rate of interest for such bonds on April 1, 2017, is 12%. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What cash proceeds did Wildhorse receive from issuance of the bonds? (Round answer to 0 decimal places, e.g. 125.) Cash proceeds from issuance of the bonds $