On January 1, 2021, QuantumQuarry Co. issued a 5-year bond with a face value of $500,000. The bond pays interest semi-annually on July 1 and January 1. At the time of issuance, the market rate was 8% for similar bonds. QuantumQuarry's fiscal year ends on December 31, and it uses the effective-interest method to amortize bond discount or premium. Related to this bond, QuantumQuarry's records show the following on December 31, 2021. Bond Payable, 10%, carrying amount Interest Payable $533,664 25,000 3. On January 1, 2023, immediately after paying interest to bondholders QuantumQuarry redeemed 20% of the outstanding bond at 102. Show how the presentation of this transaction would be reported on: a. Statement of cash flows b. Income statement c. Balance Sheet

On January 1, 2021, QuantumQuarry Co. issued a 5-year bond with a face value of $500,000. The bond pays interest semi-annually on July 1 and January 1. At the time of issuance, the market rate was 8% for similar bonds. QuantumQuarry's fiscal year ends on December 31, and it uses the effective-interest method to amortize bond discount or premium. Related to this bond, QuantumQuarry's records show the following on December 31, 2021. Bond Payable, 10%, carrying amount Interest Payable $533,664 25,000 3. On January 1, 2023, immediately after paying interest to bondholders QuantumQuarry redeemed 20% of the outstanding bond at 102. Show how the presentation of this transaction would be reported on: a. Statement of cash flows b. Income statement c. Balance Sheet

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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