Exercise 10-5 (Algo) Straight-Line: Recording bond issuance and discount amortization LO P2Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $90,000 and semiannual interestpayments.Semiannual Period-End(0) January 1, issuance(1) June 30, first payment(2) December 31, second paymentUnamortized Discount$ 6,5335,7164,899Carrying Value$ 83,46784,28485,101Use the above straight-line bond amortization table and prepare journal entries for the following.(a) The issuance of bonds on January 1.(b) The first interest payment on June 30.(c) The second interest payment on December 31.View transaction listJournal entry worksheet123Record the issuance of the bonds on January 1.Note: Enter debits before credits.DateJanuary 01General JournalDebitCredit

The objective of the question is to prepare journal entries for the issuance of bonds and the first…

Answered: Exercise 10-5 (Algo) Straight-Line:…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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x Premium Amortization On the first day of the fiscal year, a company issues a $8,500,000, 9%, 10-year bond that pays semiannual interest of $382,500 ($8,500,000 × 9% × ½), receiving cash of $9,077,589. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense fill in the blank fill in the blank Premium on Bonds Payable fill in the blank fill in the blank Cash
Premium Amortization On the first day of the fiscal year, a company issues a $3,500,000, 6%, 9-year bond that pays semiannual interest of $105,000 ($3,500,000 × 6% × ½), receiving cash of $4,322,808. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense Premium on Bonds Payable Cash
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 > 0
Required information Exercise 9-11B Record bonds issued at a discount and related semiannual interest (LO9-6) [The following information applies to the questions displayed below.] On January 1, Year 1, a company issues $440,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 8%, the bonds will issue at $410,103. Exercise 9-11B Part 1 Required: 1. Complete the first three rows of an amortization schedule. (Round your final answers to the nearest whole dollar.) Interest Increase in Date Cash Paid Carrying Value Expense Carrying Value 01/01/Year 1 06/30/Year 1 12/31/Year 1
Subject: accounting
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Exercise 14-5 (Algo) Straight-Line: Recording bond issuance and discount amortization LO P2 Paulson Company issues 8%, four-year bonds, on January 1 of this year, with a par value of $103,000 and semiannual interest payments. Semiannual Period-End (0) January 1, issuance (1) June 30, first payment (2) December 31, second payment Use the above straight-line bond amortization table and prepare journal entries for the following. Unamortized Discount $ 6,793 (a) The issuance of bonds on January 1. (b) The first interest payment on June 30. (c) The second interest payment on December 31. Carrying Value $ 96,207 97,056 97,905 5,944 5,095
Question 6 (i) On 1 April, year 1, Happy Corporation issues $50 million of 10%, 30-year bonds payable at par. Interest on the bonds is payable semiannually each 1 April and 1 October. The journal entry to record the first cash payment to bondholders on 1 October, year 1, will include: A: A credit to Cash of $5,000,000. B: A credit to Interest Payable of $2,500,000. C: A debit to Bonds Payable of $5,000,000. D: A debit to Interest Expense of $2,500,000. (ii) ABC Manufacturing Company sold a vehicle for cash of $70,000 with a loss of $10,000 recognized. The accumulated depreciation amounted to $140,000. The original cost of the asset must have been: A: $130,000. B: $150,000. C: $200,000. D: $220,000.
Exercise 10-3 (Algo) Recording bond issuance and interest LO P1 On January 1, Boston Enterprises Issues bonds that have a $1,600,000 par value, mature in 20 years, and pay 8% Interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much Interest will Boston pay (in cash) to the bondholders every six months? 2. Prepare Journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the second Interest payment on December 31. 3. Prepare the journal entry for Issuance assuming the bonds are issued at (a) 98 and (b) 102. Complete this question by entering your answers in the tabs below. Required 1 Required 2 How much interest will Boston pay (in cash) to the bondholders every six months? Semiannual Cash Interest Payment Par (maturity) Value Required 3 X Semiannual Rate Required 1 Required 2 >

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