On January 1 of this year, Olive Corporation issued bonds. Interest is payable once a year on December 31. The bonds mature at the end of four years. Olive uses the effective-interest amortization method. The partially completed amortization schedule below pertains to the bonds:
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- On Jan. 1, Year 1, Foxcroft Inc. issued 100 bonds with a face value of $1,000 for $104,000. The bonds had a stated rate of 6% and paid interest semiannually. What is the journal entry to record the issuance of the bonds?[The following information applies to the questions displayed below.] On January 1 of this year, Olive Corporation issued bonds. Interest is payable once a year on December 31. The bonds mature at the end of four years. Olive uses the effective-interest amortization method. The partially completed amortization schedule below pertains to the bonds: Date Cash Interest Amortization Balance 1/1/20x1 $ 52,833 12/31/20x1 $ 5,200 $ 5,019 $ 181 52,652 12/31/20x2 ? ? ? 12/31/20x3 ? ? 217 52,454 ? 12/31/20x4 ? 4,963 ? 52,000 Required: 1. Complete the amortization schedule. Note: Enter all your values in positive. Round your final answers to nearest whole dollar amount. Date 1/1/20x1 12/31/20x1 Cash Interest Amortization Balance $ 52,833 $ 5,200 $ 5,019 $ 181 $ 52,652 12/31/20x2 $ 52,454 12/31/20x3 $ 217 12/31/20x4 4,963 $ 52,000Sikes Corporation, whose annual accounting period ends on December 31, issued the following bonds: Date of bonds: January 1, 2021 Maturity amount and date: $130,000 due in 10 years (December 31, 2030) Interest: 10 percent per year payable each December 31 Date issued: January 1, 2021 Required: 1. For each of the three independent cases that follow, provide the amounts to be reported on the January 1, 2021, financial statements immediately after the bonds are issued. TIP: See Exhibit 10.6 for an illustration distinguishing Bonds Payable from their carrying value. (Deductions should be indicated by a minus sign.) January 1, 2021-Financial statements: a. Bonds payable b. Unamortized premium (or discount) c. Carrying value Case A (At 100) Case B (At 95) Case C (At 103)
- On January 1, Year 1, Hackman Corporation issued $600,000 face value 6% bonds dated January 1, Year 1, for $621,430. The bonds pay interest semiannually on June 30 and December 31 and are due December 31, Year 5. Hackman uses the straight-line amortization method. Required: Record the issuance of the bonds and the first two interest payments. Record the issuance of the bonds on January 1 and the first two interest payments on June 30 and December 3Jackson, Inc.’s fiscal year ends December 31. Selected transactions for the period 20-1 through 20-8 involving bonds payable issued by Jackson are as follows: 20-1 Transactions: Oct. 31 Issued $600,000 of 10-year, 7%, callable bonds dated October 31, 20-1, for $612,000. Interest is payable semiannually on October 31 and April 30. The bond indenture provides that Jackson is to pay to the trustee bank $20,000 by May 15 of each year (except the tenth year) as a sinking fund for the retirement of the bonds on call or at maturity. Dec. 31 Made the adjusting entry for interest payable and amortized two months’ premium on the bonds (straight-line method). 20-2 Transactions: Jan. 2 Reversed the adjusting entry for interest payable and bond premium amortization. Apr. 30 Paid the semiannual interest on the bonds and amortized six months’ premium. May 15 Paid the sinking fund trustee $20,000. Oct. 31 Paid the semiannual interest on the bonds and amortized six months’…On January 1, Year 1, Twain Corporation sold $620,000 of its own 5 percent, 10-year bonds. Interest is payable annually on December 31. The bonds were sold to yield an effective interest rate of 6 percent. Twain uses the effective interest rate method. The bonds sold for $574,368. Requireda. Prepare the journal entry for the issuance of the bonds.b. Prepare the journal entry for the amortization of the bond discount and the payment of the interest at December 31, Year 1. (Assume effective interest amortization.)c. Prepare the journal entry for the amortization of the bond discount and the payment of interest on December 31, Year 1. (Assume straight-line amortization.)d. Calculate the amount of interest expense for Year 2. (Assume effective interest amortization.) e. Calculate the amount of interest expense for Year 2. (Assume straight-line amortization.)
- On January 1, Year 1, Bell Corporation issued $203,000 of 10-year, 6 percent bonds at their face amount. Interest is payable on December 31 of each year with the first payment due December 31, Year 1. RequiredPrepare all the general journal entries related to these bonds for Year 1 and Year 2. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)On September 1, Year 1, Parsons Company purchased $84,000 of 10-year, 7% government bonds at 100 plus accrued interest. The semiannual interest payment dates are June 30 and December 31. Interest computations are done by the month. Required: a. Journalize the entry for the bond purchase. b. Journalize the receipt of interest on December 31 of the first year. c. Journalize the sale of the bonds on February 1 of the second year for $82,000 plus accrued interest. If an amount box does not require an entry, leave it blank. a. Year 1 Sept. 1 b. Year 1 Dec. 31 c. Year 2 Feb. 11.On January 1, Year 1, Wayne Company issued bonds with a face value of $600,000, a 6% stated rate of interest, and a 10-year term. Interest is payable in cash on December 31 of each year. Wayne uses the straight-line method to amortize bond discounts and premiums. Assuming Wayne issued the bonds for 102.5, what is the amount of interest expense that will be reported on the income statement for the year ending December 31, Year 1? 2. On January 1, Year 1, Wayne Company issued bonds with a face value of $600,000, a 6% stated rate of interest, and a 10-year term. Interest is payable in cash on December 31 of each year. Wayne uses the straight-line method to amortize bond discounts and premiums. 2.Assuming Wayne issued the bonds for 102.5, what is the amount of interest expense that will be reported on the income statement for the year ending December 31, Year 1? 3.Perry Corporation was established on January 1, Year 1 when it issued 20,000 shares of $50 par, 5 percent, cumulative…
- During two consecutive years, Antlers Company, Inc., completed the following transactions: Year 1 June 1 Issued $750,000 face value, 20-year, 12 percent bonds, dated June 1 of this year, at 103. Interest is payable semiannually on December 1 and June 1. Dec. 1 Paid semiannual interest on the bonds. 31 Recorded an adjusting entry for accrued interest payable. 31 Recorded an adjusting entry for amortization of premium on bonds. 31 Closed the Interest Expense account. Year 2 Jan. 1 Reversed the adjusting entry for accrued interest payable. June 1 Paid semiannual interest on the bonds. Dec. 1 Paid semiannual interest on the bonds. June 31 Recorded an adjusting entry for accrued interest payable. 31 Recorded an adjusting entry for amortization of premium on bonds. 31 Closed the Interest Expense account. Can I get some help for the second year?On January 1, Year 1, Wayne Company issued bonds with a face value of $635,000, a 5% stated rate of interest, and a 10-year term. Interest is payable in cash on December 31 of each year. Wayne uses the straight-line method to amortize bond discounts and premiums. Assuming Wayne issued the bonds for 102.0, what is the amount of interest expense that will be reported on the income statement for the year ending December 31, Year 1? Multiple Choice $30,480 $31,750 $33,020 $12,700Metlock, Inc. issued $282,000, 7%, 15-year bonds on December 31, 2021, for $253,800. Interest is payable annually on December 31. Metlock uses the straight-line method to amortize bond premium or discount. 1.Prepare the journal entry to record the issuance of the bonds. 2.Prepare the journal entry to record the payment of interest and the related amortization on july 1, 2021. 3.Prepare the journal entry to record the accrual of interest and the related amortization on December 31, 2021.