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On January 1, Year 1, Hart Company issued bonds with a face value of $150,000, a stated rate of interest of 8 percent, and a five- year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 7 percent at the time the bonds were issued. The bonds sold for $156,150. Hart used the effective interest rate method to amortize the bond premium. (Round your intermediate calculations and final answers to the nearest whole number.) Required a. Prepare an amortization table. Premium Amortization Carrying Value Cash Interest Date Payment Expense January 1, Year 1 156,150 December 31, Year 1 12,000 10,931 1,069 155,081 December 31, Year 2 December 31, Year 3 December 31, Year 4 December 31, Year 5 Totals

On January 1, Year 1, Hart Company issued bonds with a face value of $150,000, a stated rate of interest of 8 percent, and a five- year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 7 percent at the time the bonds were issued. The bonds sold for $156,150. Hart used the effective interest rate method to amortize the bond premium. (Round your intermediate calculations and final answers to the nearest whole number.) Required a. Prepare an amortization table. Premium Amortization Carrying Value Cash Interest Date Payment Expense January 1, Year 1 156,150 December 31, Year 1 12,000 10,931 1,069 155,081 December 31, Year 2 December 31, Year 3 December 31, Year 4 December 31, Year 5 Totals

FINANCIAL ACCOUNTING
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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b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the interest expense that would appear on the Year 4 income statement? d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows? b. Carrying value on the Year 4 C. Interest expense for Year 4 d. Cash outflow for interest in Year 4 ( Prev 7 of 8 Next >
Transcribed Image Text:b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the interest expense that would appear on the Year 4 income statement? d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows? b. Carrying value on the Year 4 C. Interest expense for Year 4 d. Cash outflow for interest in Year 4 ( Prev 7 of 8 Next >
On January 1, Year 1, Hart Company issued bonds with a face value of $150,000, a stated rate of interest of 8 percent, and a five- year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 7 percent at the time the bonds were issued. The bonds sold for $156,150. Hart used the effective interest rate method to amortize the bond premium. (Round your intermediate calculations and final answers to the nearest whole number.) Required a. Prepare an amortization table. Cash Payment Premium Amortization Carrying Value Interest Date Expense January 1, Year 1 December 31, Year 1 156,150 12,000 10,931 1,069 155,081 December 31, Year 2 December 31, Year 3 December 31, Year 4 December 31, Year 5 Totals
Transcribed Image Text:On January 1, Year 1, Hart Company issued bonds with a face value of $150,000, a stated rate of interest of 8 percent, and a five- year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 7 percent at the time the bonds were issued. The bonds sold for $156,150. Hart used the effective interest rate method to amortize the bond premium. (Round your intermediate calculations and final answers to the nearest whole number.) Required a. Prepare an amortization table. Cash Payment Premium Amortization Carrying Value Interest Date Expense January 1, Year 1 December 31, Year 1 156,150 12,000 10,931 1,069 155,081 December 31, Year 2 December 31, Year 3 December 31, Year 4 December 31, Year 5 Totals
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