Pina Co. is building a new hockey arena at a cost of $2,680,000. It received a downpayment of $500,000 from local businesses to support the project, and now needs to borrow $2,180,000 to complete the project. It therefore decides to issue $2,180,000 of 10.0%, 10-year bonds. These bonds were issued on January 1, 2024, and pay interest annually on each January 1. The bonds yield 99%.
Pina Co. is building a new hockey arena at a cost of $2,680,000. It received a downpayment of $500,000 from local businesses to support the project, and now needs to borrow $2,180,000 to complete the project. It therefore decides to issue $2,180,000 of 10.0%, 10-year bonds. These bonds were issued on January 1, 2024, and pay interest annually on each January 1. The bonds yield 99%.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Qq.10.
![(b)
Prepare a bond amortization schedule up to and including January 1, 2028, using the effective-interest method. (Round present
value factor to 5 decimal places, eg. 1.24356 and final answers to 0 decimal places, eg. 38,548.)
Date
1/1/24
1/1/25
1/1/26
1/1/27
1/1/28
$
Cash
Paid
$
Interest
Expense
Premium
Amortization](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8f6b9bf3-9222-4e20-9362-1764c39421ae%2F47196024-3c52-4dc2-ab19-d07eb22ae65d%2Favaef5_processed.png&w=3840&q=75)
Transcribed Image Text:(b)
Prepare a bond amortization schedule up to and including January 1, 2028, using the effective-interest method. (Round present
value factor to 5 decimal places, eg. 1.24356 and final answers to 0 decimal places, eg. 38,548.)
Date
1/1/24
1/1/25
1/1/26
1/1/27
1/1/28
$
Cash
Paid
$
Interest
Expense
Premium
Amortization
![Pina Co. is building a new hockey arena at a cost of $2,680,000. It received a downpayment of $500,000 from local businesses to
support the project, and now needs to borrow $2,180,000 to complete the project. It therefore decides to issue
$2,180,000 of 10.0%, 10-year bonds. These bonds were issued on January 1, 2024, and pay interest annually on each January 1. The
bonds yield 9%.
Click here to view factor table.
(a)
Your answer is correct.
Prepare the journal entry to record the issuance of the bonds on January 1, 2024. (Round present value factor calculations to 5
decimal places, eg 125124 and the final answer to O decimal places, eg. 58,971. If no entry is required, select "No Entry" for the account
titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.
List all debit entries before credit entries.)
Date Account Titles and Explanation
January
1,2024
Cash
Premium on Bonds Payable
Bonds Payable
eTextbook and Media
List of Accounts
Debit
2319904
Credit
139904
2180000
Attempts: 1 of 5 used](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8f6b9bf3-9222-4e20-9362-1764c39421ae%2F47196024-3c52-4dc2-ab19-d07eb22ae65d%2Fbgy0vxo_processed.png&w=3840&q=75)
Transcribed Image Text:Pina Co. is building a new hockey arena at a cost of $2,680,000. It received a downpayment of $500,000 from local businesses to
support the project, and now needs to borrow $2,180,000 to complete the project. It therefore decides to issue
$2,180,000 of 10.0%, 10-year bonds. These bonds were issued on January 1, 2024, and pay interest annually on each January 1. The
bonds yield 9%.
Click here to view factor table.
(a)
Your answer is correct.
Prepare the journal entry to record the issuance of the bonds on January 1, 2024. (Round present value factor calculations to 5
decimal places, eg 125124 and the final answer to O decimal places, eg. 58,971. If no entry is required, select "No Entry" for the account
titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.
List all debit entries before credit entries.)
Date Account Titles and Explanation
January
1,2024
Cash
Premium on Bonds Payable
Bonds Payable
eTextbook and Media
List of Accounts
Debit
2319904
Credit
139904
2180000
Attempts: 1 of 5 used
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