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tal par value of $100,00

tal par value of $100,00

FINANCIAL ACCOUNTING
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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KC Corporation issued bonds with a total par value of $100,000 on 1/1/20x1. The following loan amortization schedule was developed for these bonds:. Year 20x1 20x2 20x3 20x4 Column Totals Beginning Carrying Value 96,613 97,376 98,192 99,065 Interest 6,763 6,816 6,873 6,935 27,387 Cash 6,000 6,000 6,000 6,000 24,000 Amortization 763 816 873 935 3,387 Based upon the above information, Assume instead of refunding the bonds on January 1, 20X4, that the company is unable to make the payment for the maturity value and for the final interest payment at the end of the bond term. Investors agree to accept instead, a four year non-interest bearing note for 103,000. Record the troubled. debt restructure on the books of the debtor
Transcribed Image Text:KC Corporation issued bonds with a total par value of $100,000 on 1/1/20x1. The following loan amortization schedule was developed for these bonds:. Year 20x1 20x2 20x3 20x4 Column Totals Beginning Carrying Value 96,613 97,376 98,192 99,065 Interest 6,763 6,816 6,873 6,935 27,387 Cash 6,000 6,000 6,000 6,000 24,000 Amortization 763 816 873 935 3,387 Based upon the above information, Assume instead of refunding the bonds on January 1, 20X4, that the company is unable to make the payment for the maturity value and for the final interest payment at the end of the bond term. Investors agree to accept instead, a four year non-interest bearing note for 103,000. Record the troubled. debt restructure on the books of the debtor
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