d. 3,740,400Problem 6-17 (AICPA Adapted)On January 1, 2020, Wolf Company issued 10% bonds in theface amount of P5,000,000, which mature on January 1, 2030.The bonds were issued for P5,675,000 to yield 8%, resultingin bond premium of P675,000.The entity used the interest method of amortizing bondpremium. Interest is payable annually on December 31.1. On December 31, 2020, what is the balance of the premiumon bonds payable?a. 675,000b. 629,000c. 607,500d. 507,5002. What is the carrying amount of bonds payable onDecember 31, 2020?a. 5,000,000b. 5,629,000c. 4,371,000d. 5,675,000231

The bonds are issued at premium when market rate is lower than the coupon rate of bonds.

Answered: On January 1, 2020, Wolf Company issued…

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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On July 1, 2019, Rix Corporation had $10,000,000 of 9% bonds outstanding. The maturity date is June 30, 2024. Interest is paid semiannually every June 30 and December 31. All the bonds were redeemed on July 1, 2019, at 98. At the time of the bond redemption, there was unamortized bond premium of $60,000 and unamortized debt issuance costs of $100,000. What is the amount of the gain on the bond redemption?
On January 1, 2020, Pine Co. issued 10%, 10-year bonds with a face value of $12,000,000. The bonds were issued for $13,620,000 to yield 8%. Interest is payable annually on December 31. Pine amortizes bond premium using the effective-interest method. The bond premium reported on Pine’s balance sheet dated December 31, 2020, would be
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On January 1, 2019, P Sport Corporation issued 10% bonds with a face value of $200,000. The bonds are sold for $191,000. The bonds pay interest semiannually on June 30 and December 31 and the maturity date is December 31, five years from now. X Sport records straight-line amortization of the bond discount. The bond interest expense for the year ended December 31, 2019 is:

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