Bombay Corporation issued 8% bonds on January 1, 2021, with a face value of $700,000, the market yield for bonds of similar risk and maturity was 10%. The bonds mature December 2023 (3 years). Interest is paid semiannually on June 30 and December 31.  Required:  1. Determine the price of the bonds on January 31, 2021.  2. Prepare the journal entry to record their issuance by Bombay on January 1, 2021. (See the below template) 3. Prepare an amortization schedule that shows the effective interest rate each period. 4. Prepare the journal entry to record interest on June 30, 2022. Date Cash Payment Effective Interest Increase in balance. Discount Reduction Outstanding Balan

Q: Super Splash issues $870,000, 7% bonds on January 1, 2021, that mature in 15 years. The market…

A: Semiannual interest payment = Face value of bonds x rate of interest x no. of months/12 = $870,000 x…

Q: When Patey Pontoons issued 6% bonds on January 1, 2024, with a face amount of $600,000, the market…

A: Solution:The query involves a situation where Patey Pontoons releases bonds on January 1, 2024, with…

Q: On January 1, 2024, Instaform, Incorporated, issued 10% bonds with a face amount of $48 million,…

A: "Bonds" refer to debt securities that are typically issued by corporations, governments, or other…

Q: When Patey Pontoons issued 10% bonds on January 1, 2024, with a face amount of $560,000, the market…

A: Net present value:Calculation used to evaluate the investment and financing decisions that involve…

Q: in January 1, 2024, Instaform, Incorporated, issued 10% bonds with a face amount of $48 million,…

A: Bonds  refer to high-security debt instruments that enable an entity to raise funds and fulfil…

Q: On January 1, 2022, Broncos Universal issued 12% bonds dated January 1, 2022, with a face amount of…

A: Bond Price :— It is sum of present value of periodic interest payment and face value amount.    If…

Q: Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $63,948 on January 1,…

A: Bonds issued at discount: When bonds are issued at price less than the face value then they are…

Q: PPetzelmaniá, Inc., issues 7%, 10-year bonds with a face amount of $70,000 for $70,000 on January 1,…

A: The bonds are issued at par when market rate is similar to coupon rate of bonds.

Q: elmania, Incorporated, issues 7%, 15-year bonds with a face amount of $64,000 for $58,467 on January…

A: A journal entry is a basic accounting record that is used to chronologically track financial…

Q: The Windy City Company issued $500,000 of 12% bonds on January 1, 2020. The bonds were sold for…

A:

Q: When Patey Pontoons issued 4% bonds on January 1, 2024, with a face amount of $660,000, the market…

A: To determine the price of the bonds on January 1, 2024, we can use the present value formula for…

Q: On May 1, 2021, Ligertwood Co. issued P5,000,000, 10%, three-year bonds to yield 8%. The bonds pay…

A: Bond is a debt security which carries a fixed interest rate. The fixed interest rate is known as…

Q: National Orthopedics Co. issued 9% bonds, dated January 1, with a face amount of $500,000 on January…

A: As posted multiple sub parts in questions we are answering only first 3 sub parts kindly repost the…

Q: On August 1, 2022, Martinez Corp. issued $489,600, 6%, 10-year bonds at face value. Interest is…

A: When the bonds are issued then cash will receive so cash account would be debited and bond payable…

Q: Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $67,000 for $73,507 on January 1,…

A: Given that, rate of interest on bonds = 7% term of the bond = 15years Face value of bonds  $67000…

Q: On January 1, 2024, Chang's Company issued 10% bonds dated January 1, 2024, with a face amount of…

A: Journal entry represents the account where the company records its financial transaction at the…

Q: On January 1, 2024, Baddour, Incorporated, issued 10%, 12-year bonds with a face amount of $176…

A: Financial reporting related to bonds involves disclosing essential information about a company's…

Q: On January 1, 2024, Instaform, Incorporated, issued 12% bonds with a face amount of $65 million,…

A: Bonds refer to an agreement in which a loan is provided by the investor to the borrower for…

Q: On August 1, 2022, Bridgeport Corp. issued $483,600, 7%, 10-year bonds at face value. Interest is…

A: given that, Bridgeport Corp. issued bonds worth $483600 Rate of interest = 7% life of bond = 10…

Q: National Orthopedics Co. issued 9% bonds, dated January 1, with a face amount of $500,000 on January…

A: 1.

Q: On January 1, 2024, Instaform, Incorporated, issued 14% bonds with a face amount of $50 million,…

A: "Bonds" refer to debt securities that are typically issued by corporations, governments, or other…

Q: Golden Inc. issues $4,000,000, 5-year, 10% bonds at 102, with interest payable annually on January…

A: Bonds are instrument issued by company acknowledging the debt raised by company . It is a liability…

Q: Calculate the value of the bond at the time of issuance, and record the initial journal entry.…

A: Bond valuation refers to a method which is used to compute the current value of future cash flow of…

Q: A. July 1, 2020: entry to record issuing the bonds. B. June 30, 2021: entry to record payment of…

A: A journal entry is a basic accounting record that is used to chronologically track financial…

Q: On January 1, 2021, Bradley Recreational Products issued $100,000, 9%, four year bonds. Interest…

A: Concept Given Date of issue January 1 2021 Face value 100000 Coupon rate 9%…

Q: When Patey Pontoons issued 10% bonds on January 1, 2024, with a face amount of $880,000, the market…

A: "Since you have asked a question with sub-parts more than three, as per guidelines, the first three…

Q: When Patey Pontoons issued 10% bonds on January 1, 2024, with a face amount of $880,000, the market…

A: “Since you have posted a question with multiple sub parts, we will provide the solution only to the…

Q: Required: Create a bond amortization schedule for the term of the bond.  Round amounts to the…

A: Issue price = Present value of face amount + Present value of semi annual cash interest payment…

Q: On January 1, 2023, Kristopher Co. issued ten-year bonds with a face value of $7,000,000 and a…

A: A bond is a financial instrument or debt security that is used to symbolize a loan that an investor…

Q: Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $63,948 on January 1,…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: On January 1, 2024, Instaform, Incorporated, Issued 10% bonds with a face amount of $48 million,…

A: Bonds are debt instruments issued by a company wherein the company promises to pay bondholders a…

Q: On January 1, 2021, Instaform, Inc., issued 10% bonds with a face amount of $50 million, dated…

A: Bonds are the financial securities which are used to raise the funds by the large organizations.…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.