Queen Energy Inc. Issued bonds on January 1, 2023, that pay interest semiannually on June 30 and December 31. The par value of the bonds is $340,000, the annual contract rate is 12%, and the bonds mature in 10 years. (Use IABLE 14A1 and IABLE 14A.2) (Use appropriate factor(s) from the tables provided.) Required: a. For each of these three situations, determine the issue price of the bonds. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) (1) (2) (3) Market rate Issue Price of the interest Bonds 10% 12% 14% b. For each of these three situations, prepare the journal entry that would record the issuance, assuming the market interest rate at the date of issuance was (1) 10%, (2) 12%, (3) 14 %. (Use PV tables in determining the issue price of the bonds. Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)

Queen Energy Inc. Issued bonds on January 1, 2023, that pay interest semiannually on June 30 and December 31. The par value of the bonds is $340,000, the annual contract rate is 12%, and the bonds mature in 10 years. (Use IABLE 14A1 and IABLE 14A.2) (Use appropriate factor(s) from the tables provided.) Required: a. For each of these three situations, determine the issue price of the bonds. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) (1) (2) (3) Market rate Issue Price of the interest Bonds 10% 12% 14% b. For each of these three situations, prepare the journal entry that would record the issuance, assuming the market interest rate at the date of issuance was (1) 10%, (2) 12%, (3) 14 %. (Use PV tables in determining the issue price of the bonds. Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On January 1, 2024, White Water issues $490,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 7% and the bonds issued at $535,061. Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $529,343 on December 31, 2026. (Round your final answers to the nearest whole dollar.)
On January 1, 2020, XYZ Co. issued 8-year bonds with a face value of $1,500,000 and a stated (nominal) interest rate of 6%, payable semiannually on June 30 and December 31. The bonds were sold to yield 4%. : Instructions (a) Calculate the selling price of the bonds payable. HINT: You will need to look up the appropriate discount values in the present value tables (b) Prepare the interest amortization table for 2020 only, assuming that amortization is recorded on interest payment dates.
On June 1, 2023, JetCom Inventors Inc. issued a $540,000, 12%, three-year bond. Interest is to be paid semiannually beginning December 1, 2023.Required:a. Calculate the issue price of the bond assuming a market interest rate of 13%. (Do not round intermediate calculations. Round the final answer to the nearest whole dollar.) - 32400 b. Using the effective interest method, prepare an amortization schedule. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar. Enter all the amounts as positive values.) - ? Part 1Prepare journal entries to the following. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)a. Issuance of the bonds on June 1, 2023b. Payment of interest on December 1, 2023c. Adjusting entry to accrue bond interest and discount amortization on January 31, 2024d. Payment of interest on June 1, 2024Assume JetCom Inventors Inc. has a January 31 year-end. Part 2Show how the bonds will appear on the…
! Required information [The following information applies to the questions displayed below.] Super Splash issues $900,000, 8% bonds on January 1, 2024, that mature in 20 years. The market interest rate for bonds of similar risk and maturity is 7%, and the bonds issue for $996,098. Interest is paid semiannually on June 30 and December 31. Required: 1. Complete the first three rows of an amortization schedule. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar.) Answer is complete but not entirely correct. Cash Date Paid Interest Expense Change in Carrying Value Carrying Value 1/1/2024 $ 996,098 6/30/2024 36,000 34,863 1,137 994,961 12/31/2024 36,000 34,890 1,110 x 993,851
Ellis Company Issues 7.0%, five-year bonds dated January 1, 2019, with a $510,000 par value. The bonds pay Interest on June 30 and December 31 and are issued at a price of $531,755. The annual market rate is 6% on the Isue date. Required: 1. Compute the total bond Interest expense over the bonds' life. 2 Prepare an effective interest amortization table for the bonds' life. 3. Prepare the journal entries to record the first two Interest payments. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare an effective interest amortization table for the bonds' life. Semiannual Period- Cash Interest Bond Interest Paid Premium Amortization Unamortized Premium Carrying Value End Expense 01/01/2019 21,755 S 531,755 08/30/2019 17,850 12/31/2019 17,850 08/30/2020 12/31/2020 08/30/2021 12/31/2021 08/30/2022 12/31/2022 08/30/2023 12/31/2023 Total
Temptation Vacations issues $60 million in bonds on January 1, 2021, that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below:Required:1. Were the bonds issued at face amount, a discount, or a premium?2. What is the original issue price of the bonds?3. What is the face amount of the bonds?4. What is the stated annual interest rate?5. What is the market annual interest rate?6. What is the total cash paid for interest assuming the bonds mature in 20 years?
On October 1, 2023, Dejour Energy Inc. issued a $697,000, 10.0%, seven-year bond. Interest is to be paid annually each October 1. Dejour Energy Inc. has a November 30 year - end. (Use TABLE 14A.1 and TABLE 14A.2.). Note: Use table values for PV calculations. (Use appropriate factor(s) from the tables provided.) Required: a. Calculate the issue price of the bond assuming a market interest rate of 12.0% on the date of the bond issue. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) b. Using the effective interest method, prepare an amortization schedule. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar. Enter all the amounts as positive values.) Part 1 Record the following entries: (Round your intermediate calculations and final answers to the nearest whole dollar.) Issuance of the bonds on October 1, 2023. Adjusting entry to accrue bond interest and discount amortization on November 30, 2023.…
Queen Energy Inc. issued bonds on January 1, 2023, that pay interest semiannually on June 30 and December 31. The par value of the bonds is $200,000, the annual contract rate is 12%, and the bonds mature in 10 years. (Use TABLE 14A.1 and TABLE 14A.2.) (Use appropriate factor(s) from the tables provided.) Required: a. For each of these three situations, determine the issue price of the bonds. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) b. For each of these three situations, prepare the journal entry that would record the issuance, assuming the market interest rate at the date of issuance was (1) 10%, (2) 12%, (3) 14%. (Use PV tables in determining the issue price of the bonds. Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)
The bonds mature on December 31, 2033 (10 years). For bonds of similar risk and maturity, the market yield is 12%. Interest is paid semiannually on June 30 and December 31. Required: 1. Determine the price of the bonds at January 1, 2024. 2. to 4. Prepare the journal entries to record their issuance by The Bradford Company on January 1, 2024, interest on June 30, 2024 (at the effective rate) and interest on December 31, 2024 (at the effective rate). Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Complete this question by entering your answers in the tabs below. Req 1 Req 2 to 4 Determine the price of the bonds at January 1, 2024. Note: Enter your answer in whole dollars. Price of bonds
Wildhorse Ltd. issued a $1,159,000, 10-year bond dated January 1, 2023. The bond was sold to yield 12% effective interest. The bond paid 10% interest on January 1 and July 1 each year. The company's year-end was December 31, and Wildhorse followed IFRS. Using 1. factor Tables 2. a financial calculator, or 3. Excel function PV, calculate the amount received for the bond, and any discount or premium on the bond. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ORDINARY ANNUITY OF 1. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places e.g. 58,971.) Proceeds from sale of bond on bond Date $ $ Prepare the journal entries for above transactions. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O…
On June 30, 2024, Single Computers issued 5% stated rate bonds with a face amount of $280 million. The bonds mature on June 30, 2039 (15 years). The market rate of interest for similar bond issues was 4% (2.0% semiannual rate). Interest is paid semiannually (2.5%) on June 30 and December 31, beginning on December 31, 2024. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: 1. Determine the price of the bonds on June 30, 2024. 2. Calculate the interest expense Single reports in 2024 for these bonds using the effective interest method.
On June 30, 2024, Single Computers issued 6% stated rate bonds with a face amount of $200 million. The bonds mature on June 30, 2039 (15 years). The market rate of interest for similar bond issues was 5% (2.5% semiannual rate). Interest is paid semiannually (3%) on June 30 and December 31, beginning on December 31, 2024. Note: Use tables, Excel, or a financial calculator. (EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) Required: 1. Determine the price of the bonds on June 30, 2024. 2. Calculate the interest expense Single reports in 2024 for these bonds using the effective interest method.