Exercise 10-17A (Algo) Computing bond interest and price; recording bond issuance LO C2 Brin Company issues bonds with a par value of $570,000. The bonds mature in 9 years and pay 8% annual interest in semiannual payments. The annual market rate for the bonds is 10%. (Table B.1, Table B.2, Table B.3, and Table B.4) Note: Use appropriate factor(s) from the tables provided. 1. Compute the price of the bonds as of their issue date. 2. Prepare the journal entry to record the bonds' issuance.
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- Charleston Inc. issued $200,000 bonds with a stated rate of 10%. The bonds had a 10-year maturity date. Interest is to be paid semi-annually and the market rate of interest is 8%. If the bonds sold at 113.55, what amount was received upon issuance?Issue Price The following terms relate to independent bond issues: 500 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 500 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 800 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,000 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Required Assuming the market rate of interest is 10%, calculate the selling price for each bond issue.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?
- RCISES i S Exercise 14-17A (Algo) Computing bond interest and price; recording bond issuance LO C2 Brin Company issues bonds with a par value of $700,000. The bonds mature in 6 years and pay 6% annual interest in semiannual payments. The annual market rate for the bonds is 8%. (Table B.1 Table B.2, Table B.3, and Table B.4) Note: Use appropriate factor(s) from the tables provided. 1. Compute the price of the bonds as of their issue date. 2. Prepare the journal entry to record the bonds' issuance. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the price of the bonds as of their issue date. Note: Round all table values to 4 decimal places, and use the rounded table values in calculations. Round intermediate calculations to the nearest dollar amount. Table Values are Based on: Cash Flow Par (maturity) value Interest (annuity) Price of bonds n = i= Table Value Amount Required 1 Present Value $ Saved Required 2 > 0Analyzing and Reporting Financial Statement Effects of Bond Transactions On January 1 of the current year, Shields Inc. issued $700,000 of 9%, 20-year bonds for $769,275, yielding a market (yield) rate of 8%. Semiannual interest is payable on June 30 and December 31 of each year. a. Show Excel inputs to confirm the bond issue price. Note: Round your answer to two decimal places. rate= nper pmt FV => Answer = $ b. Indicate the financial statement effects using the template for (1) bond issuance, (2) semiannual interest payment and premium amortization on June 30 of the current year, and (3) semiannual interest payment and premium amortization on December 31 of the current year. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your answers to the nearest whole dollar. Balance Sheet…5 On January 1, Ruiz Company issued bonds as follows: Face Value: Number of Years: Stated Interest Rate: Interest payments per year 7 B 9 0 1 2 AWN IC $500,000 a) Required: 1) Calculate the bond selling price given the two market interest rates below. Use formulas that reference data from this worksheet and from the appropriate future or present value tables (found by clicking the tabs at the botto this worksheet). Note: Rounding is not required. 15 7% 2 Annual Market Rate Semiannual Interest Payment: PV of Face Value: +PV of Interest Payments: Bond Selling Price: Annual Market Rate Semiannual Interest Payment: PV of Face Value: +PV of Interest Payments: = Bond Selling Price: 9% $17,500 133,500.01 285,055.55 418,555.56 6.00% $17,500 205,993.38 5343,007.72 $549,001.10 +
- Q-3: Dawlance Company issues 12%, 10-year bonds with a par value of Rs. 200,000 and annual interest payments. On the issue date, the annual market rate for these bonds is implies a selling price of 112. The effective interest method is used to allocate interest expense. A. What are the issuer's cash proceeds from issuance of these bonds? B. What total amount of bond interest expense will be recognized over life of these bonds? C. What amount of bond interest expense is recorded on the first interest payment date? D. Prepare the journal entries for the issuance of the bonds. Also calculate market price. 10%, whicha. On January 1, 20X1, your firm issues a $15,000, 4-year, 5% bond with interest payable annually for $13,056. At the time of the issuance, market rates are 9%. Journalize the issuance of the bond. DATE Debit Credit XIX b. Journalize the first annual interest payment on December 31, 20X1. DATE Debit Credit XIX c. Journalize the amortization of the premium/discount on December 31, 20X1. (If necessary, round to the nearest dollar.) DATE Debit Credit XIX d. On January 1, 20X2, the bonds are called at 99. Journalize this transaction. DATE Debit Credit XIXExercise 14-17A (Algo) Computing bond interest and price; recording bond issuance LO C2 Brin Company issues bonds with a par value of $610,000. The bonds mature in 9 years and pay 9% annual interest in semiannual payments. The annual market rate for the bonds is 12%. (Table B.1. Table 8.2. Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided.) 1. Compute the price of the bonds as of their issue date. 2. Prepare the journal entry to record the bonds' issuance. Complete this question by entering your answers in the tabs below.. Requirei 1 Required 2 Compute the price of the bonds as of their issue date. (Round all table values to 4 decimal places, and use the rounded table values in calculations. Round intermediate calculations to the nearest dollar amount.) Table Values are Based on: Cash Flow Par (maturity) value Interest (annuity) Price of bonds nw 18 6.0% Answer is complete but not entirely correct. Table Value 0.3503✔ 10.8280 x Amount $610,000 $ 27,450…
- Question 1 A) Explain any four of the following types of bond issues: Secured bonds. Term bonds. Convertible bonds. Registered and bearer (coupon) bonds. Income and revenue bonds. B) X Corporation issues OMR 200,000 of 9 % bonds, due in 10 years, with interest payable half Yearly. At the time of issue, the market rate for such bond is 10%. Compute the issue price of bond.Analyzing and Reporting Financial Statement Effects of Bond Transactions On January 1 of the current year, Trueman Corporation issued $400,000 of 20-year, 11% bonds for $369,908, yielding a market (yield) rate of 12%. Interest is payable semiannually on June 30 and December 31. (a) Confirm the bond issue price. Round your answers to the nearest whole number. Present value of principal repayment $ Present value of interest payments $ Selling price of bonds (b) Indicate the financial statement effects using the template for (1) bond issuance, (2) semiannual interest payment and discount amortization on June 30, and (3) semiannual interest payment and discount amortization on December 31 of the current year. $369,908 Round answers to nearest whole number. Use negative signs with answers, when appropriate. Balance Sheet Transaction Cash Asset + (1) (2) (3) Noncash Assets = Liabilities + Contributed Capital + Earned Capital Revenue Income Statement - Expenses = Net IncomeExercise 10-18A (Algo) Computing bond interest and price; recording bond issuance LO C2 Citywide Company issues bonds with a par value of $77,000. The bonds mature in nine years and pay 8% annual interest in semiannual payments. The annual market rate for the bonds is 6%. (Table B.1, Table B.2, Table B.3, and Table B.4) Note: Use appropriate factor(s) from the tables provided. 1. Compute the price of the bonds as of their issue date. 2. Prepare the journal entry to record the bonds' issuance. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the price of the bonds as of their issue date. Note: Round intermediate calculations to the nearest dollar amount. Table Values are Based on: Cash Flow Par (maturity) value Interest (annuity) Price of bonds n = i = 14 x 4.0% X X Answer is not complete. Table Value 0.5775 x 10.5631 X Amount $ 85,000 X = $ 4,250 X = Present Value 49,088 44,893 93,981 $