On January 1, 2018, Instaform, Inc., issued 10% bonds with a face amount of $50 million, dated January 1. Thebonds mature in 2037 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paidsemiannually.Required:1. Determine the price of the bonds at January 1, 2018, and prepare the journal entry to record their issuance byInstaform.2. Assume the market rate was 9%. Determine the price of the bonds at January 1, 2018, and prepare the journalentry to record their issuance by Instaform.3. Assume Broadcourt Electronics purchased the entire issue in a private placement of the bonds. Using the datain requirement 2, prepare the journal entry to record the purchase by Broadcourt
On January 1, 2018, Instaform, Inc., issued 10% bonds with a face amount of $50 million, dated January 1. The
bonds mature in 2037 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid
semiannually.
Required:
1. Determine the price of the bonds at January 1, 2018, and prepare the
Instaform.
2. Assume the market rate was 9%. Determine the price of the bonds at January 1, 2018, and prepare the journal
entry to record their issuance by Instaform.
3. Assume Broadcourt Electronics purchased the entire issue in a private placement of the bonds. Using the data
in requirement 2, prepare the journal entry to record the purchase by Broadcourt
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