Lumen Lighting Inc. issues $800,000 of its 12%, 8-year bonds at 98 on January 1, 2022. The bonds pay interest on January 1 and July 1. Lumen uses the straight-line method for amortization. What net amount will be reported for the bonds on the July 1, 2022 balance sheet?

Lumen Lighting Inc. issues $800,000 of its 12%, 8-year bonds at 98 on January 1, 2022. The bonds pay interest on January 1 and July 1. Lumen uses the straight-line method for amortization. What net amount will be reported for the bonds on the July 1, 2022 balance sheet?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 4EB: Chung Inc. issued $50,000 of 3-year bonds on January 1, 2018, with a stated rate of 4% and a market...

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Question

I am looking for the correct answer to this general accounting question with appropriate explanations.

Lumen Lighting Inc. issues $800,000 of its 12%, 8-year bonds at 98
on January 1, 2022. The bonds pay interest on January 1 and July 1.
Lumen uses the straight-line method for amortization.
What net amount will be reported for the bonds on the July 1, 2022
balance sheet?

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