Colwood Candies issued $370,000 of 12%, five-year bonds on January 1, 2020, when the market interest rate was 16%. The company pays interest annually at year-end. The issue price of the bonds was $321,540. Requirement Create a spreadsheet model to prepare a schedule to amortize the bonds. Use the effective-interest method of amortization. Round to the nearest dollar Requirement. Create a spreadsheet model to prepare a schedule to amortize the bonds. Use the effective-interest method of amortization (Round your final answer to the nearest dollar. For amounts w zero balance, enter a 0 where appropriate.) A B C Interest Payment Interest Expense (16% of (12% of Maturity Value) Preceding Bond Carrying Amount) Date 1-1-2020 12-31-2020 S 12-31-2021 12-31-2022 12-31-2023 12-31-2024 44,400 44,400 44,400 44,400 44,400 51446 52574 53882 55399 56838 D Discount Amortization Discount Balance (C-B) (Preceding E-D) 48460 41414 33240 22758 11759 E 7046 8174 9482 10999 12438 F Bond Carrying Amount ($370,000-E) 321540 328586 336760 346242 355243 367682

Colwood Candies issued $370,000 of 12%, five-year bonds on January 1, 2020, when the market interest rate was 16%. The company pays interest annually at year-end. The issue price of the bonds was $321,540. Requirement Create a spreadsheet model to prepare a schedule to amortize the bonds. Use the effective-interest method of amortization. Round to the nearest dollar Requirement. Create a spreadsheet model to prepare a schedule to amortize the bonds. Use the effective-interest method of amortization (Round your final answer to the nearest dollar. For amounts w zero balance, enter a 0 where appropriate.) A B C Interest Payment Interest Expense (16% of (12% of Maturity Value) Preceding Bond Carrying Amount) Date 1-1-2020 12-31-2020 S 12-31-2021 12-31-2022 12-31-2023 12-31-2024 44,400 44,400 44,400 44,400 44,400 51446 52574 53882 55399 56838 D Discount Amortization Discount Balance (C-B) (Preceding E-D) 48460 41414 33240 22758 11759 E 7046 8174 9482 10999 12438 F Bond Carrying Amount ($370,000-E) 321540 328586 336760 346242 355243 367682

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 January 1, 2021, the company issued $1,800,000, 6% bonds with a 10-year maturity. The bonds were issued to investors that require an effective interest rate of 9%. The accountant did NOT record the issuance of these bonds. Interest is paid annually and the accountant did NOT record the interest payment transaction. The effective interest method is used to amortize any premium or discount. NOTE – round calculations to nearest dollar. In the Excel spreadsheet, see the tab labelled “Bonds Payable – Series 2” to make any calculations, including an amortization schedule, to support journal entries.
The balance sheet for Ivanhoe Consulting reports the following information on July 1, 2022. Long-term liabilities Bonds payable $4,500,000 Less: Discount on bonds payable 315,000 $4,185,000 Ivanhoe decides to redeem these bonds at 101 after paying annual interest.Prepare the journal entry to record the redemption on July 1, 2022.
Boyd Co. produces and sells aviation equipment. On the first day of its fiscal year, Boyd issued $83,000,000 of five-year, 8% bonds at a market (effective) interest rate of 10%, with interest payable semiannually. This information has been collected in the Microsoft Excel Online file. The amount of discount to be amortized for the first semiannual interest payment period, using the interest method. Round your answer to the nearest dollar.
On January 1, 2016, a company issued $400,000 of 10-year, 12% bonds. The interest is payable semi-annually on June 30 and December 31. The issue price was $413,153 based on a 10% market interest rate. The effective-interest method of amortization is used. Rounding all calculations to the nearest whole dollar, what is the interest expense for the six-month period ending June 30, 2016? Select one: A. $20,658. B. $24,000. O C. $24,789. O D. $20,000.
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Boyd Co. produces and sells aviation equipment. On the first day of its fiscal year, Boyd issued $83,000,000 of five-year, 8% bonds at a market (effective) interest rate of 10%, with interest payable semiannually. This information has been collected in the Microsoft Ex Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. Open spreadsheet Compute the following: A. The amount of cash proceeds from the sale of the bonds. Round your answer to the nearest dollar. $4 B. The amount of discount to be amortized for the first semiannual interest payment period, using the interest method. Round your answer to the nearest dollar. C. The amount of discount to be amortized for the second semiannual interest payment period, using the interest method. Round your answer to the nearest dollar. D. The amount of the bond interest expense for the first year. Round your answer to the nearest dollar.
Waldron Corporation issued $900,000 of 16%, 10-year bonds payable on January 1, 2022. The market interest rate at the date of issuance was 14%, and the bonds pay interest semiannually (on June 30 and December 31). Waldron Corporation's year-end is June 30. Read the requirements 1. Using the PV function in Excel, calculate the issue price of the bonds. (Round your answer to the nearest whole dollar) The issue price of the bonds is Requirements 1. Using the PV function in Excel, calculate the issue price of the bonds. 2. Prepare an effective-interest amortization table for the bonds through the first three interest payments, Round amounts to the nearest dollar. 3. Record Waldron Corporation's issuance of the bonds on January 1, 2022, and payment of the first semiannual interest amount and amortization of the bond premium on June 30, 2022 Explanations are not required Print Done
Frozen Company issues $31,800 of ten year bonds on January 1, 2020 at 108. It uses the straight line method of amortization and prepares annual financial statements on December 31st. (Keep two decimal places in all your intermediate calculations). Required 1: What is the carrying value of the bonds on 2020 Financial Statements? Required 2: What is the carrying value of the bonds on 2021 Financial Statements? Required 3: What is the carrying value of the bonds on 2024 Financial Statements?
An accounting example: Otter Products inc issued bonds on January 1, 2019. Interest to be paid semi-annually. Term in years is 2; Face value of bonds issued is $200,000; Issue Price $206,000; Specified Interest Rate each payment period is 6% Question. Calculate a. the amount of interest paid in cash every payment period. b. The amount of amortization to be recorded at each interest payment date (use straight-line method) c. complete amoritzation table by calculating interest expense and beginning and ending bond carrying amounts at the each period over 2 years. The term is for 2 years however 3 years is showing on the workbook. How do I calcuate the 3rd year if the problem only says the term is 2 years?
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Compute bond proceeds, amortizing discount by interest method, and interest expense Boyd Co. produces and sells aviation equipment. On the first day of its fiscal year, Boyd issued $80,000,000 of five-year, 9% bonds at a market (effective) interest rate of 11%, with interest payable semiannually. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet Compute the following: a. The amount of cash proceeds from the sale of the bonds. Round your answer to the nearest dollar. $ b. The amount of discount to be amortized for the first semiannual interest payment period, using the interest method. Round your answer to the nearest dollar. $ 73,969,806 X $ c. The amount of discount to be amortized for the second semiannual interest payment period, using the interest method. Round your answer to the nearest dollar. 468,339 X $ 442,581 X d. The amount of the bond…
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