o.mheducation.com/ext/map/index.html?_con3con&external_browser=D08&launchUrl=https%253A%252F%252Fnewconnect.mhedfective Interest Extra CreditSavedRequired 1Required 2Required 3Required 4Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.Total bond interest expense over life of bonds:Amount repaid:okpayments ofPar value at maturityntTotal repaidencesLess amount borrowedTotal bond interest expense$< Required 1Required 3>< Prev1 of 1Next >here to search93بااالالالالالل ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=D0&launchUrl=https%253A%252F%252Fnewconnect.mheducation.com%252F#/acti10 Effective Interest Extra Credit iSavedHelpSave & ExitCheck my1Legacy issues $325,000 of 5%, four-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31They are issued at $292,181 when the market rate is 8%.Required:1. Prepare the January 1 journal entry to record the bonds' issuance.2. Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.3. Prepare an effective interest amortization table for the bonds' first two years.4. Prepare the journal entries to record the first two interest payments.intseBookPrintReferencesComplete this question by entering your answers in the tabs below.Required 1Required 2Required 3Required 4Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.Total bond interest expense over life of bonds:Amount repaid:payments ofPar value at maturity< PrevNext>Hill1 of 1Type here to search93%C UUU ULLJUUL

Interest cost: It refers to the amount paid by the borrower of the funds to the lender. Interest is…

Required 1 Required 2 Required 3 Required 4 Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life. Total bond interest expense over life of bonds: Amount repaid: payments of Par value at maturity Total repaid Less amount borrowed Total bond interest expense %24

Required 1 Required 2 Required 3 Required 4 Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life. Total bond interest expense over life of bonds: Amount repaid: payments of Par value at maturity Total repaid Less amount borrowed Total bond interest expense %24

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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Period Cash Paid Interest Expense Interest in Carrying Value Carrying Value Issue Date $85,940 1 $4,100 $ 3,438 $662 85,278 2 4,100 3,411 689 84,589 1. & 2. Record the bond issue assuming the face value of bonds payable is $79,000 and first interest payment. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) Record the bond issue. Event General Journal Debit Credit 1 Record the first interest payment. Event General Journal Debit Credit 2
22) The effective interest rate method of amortizing bonds allocates the same amount of interest expense to each period. TRUE FALSE
iRequirements 1. Journalize Andersen Brothers's transactions related to the bonds for 2018. 2. Journalize the entry required on the Thomson bonds maturity date. (Assume the last interest payment has already been recorded.) Print Done
Question 5 Company ABC, Co issued bonds at a premium and reports interest expense with the effective interest method. At each subsequent interest payment date, the cash interest paid is: A) Not Equal to the effective interest. B) Equal to the effective interest. C) Not Always the same dollar amount O A O B O C Drovieu MacBook Air F1 F2 F3 F4 F5 F6 F 7 23 24 3 4 & 7 Q E R T A F G H C V B
Question 21 If an issuer retires a debt issue before its maturity, the amount paid to do so is called the: A) sinking fund amount. B the discount. Ⓒ par or face amount. D amortized payoff. E call price.
On January 1, 2021, Shay Company issues $290,000 of 11%, 20-year bonds. The bonds sell for $282,750. Six years later, on January 1, 2027, Shay retires these bonds by buying them on the open market for $303,050. All interest is accounted for and paid through December 31, 2026, the day before the purchase. The straight-line method is used to amortize any bond discount. 1. What is the amount of the discount on the bonds at issuance? 2. How much amortization of the discount is recorded on the bonds for the entire period from January 1, 2021, through December 31, 2026? 3. What is the carrying (book) value of the bonds as of the close of business on December 31, 2026? 4. Prepare the journal entry to record the bond retirement. Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Req 4 1. What is the amount of the discount on the bonds at issuance? 2. How much amortization of the discount is recorded on the bonds for the entire period from January 1, 2021,…
Question 12 Gulf Company issued bonds with a par value of $500,000 for cash of $530,000. What is the account's name and type representing the difference between par value and issue price? OA A bond premium; a contra asset account O B. A bond discount; a contra equity account. OCA bond premium; an adjunct account. O D. A bond discount; a contra liability account.
Compute bond proceeds, amortizing premium by interest method, and interest expense DATA Face amount of bonds Contract rate of interest Term of bonds, years Market rate of interest Interest payment REQUIRED: a. Compute the amount of cash proceeds from the sale of the bonds. $41,000,000 11% 3 9% Semiannual b. Compute the amount of premium to be amortized for the first semiannual interest payment period, using the interest method. c. Compute the amount of premium to be amortized for the second semiannual interest payment period, using the interest method. d. Compute the amount of the bond interest expense for the first year. Using formulas and cell references from the problem data, perform the required analysis. Formulas entered in the green cells show in the orange cells. Transfer amounts to CNOWv2 for grading. a. PV of cash proceeds b. Premium amortized for the 1st interest payment period c. Premium amortized for the 2nd interest payment period d. Interest expense for the 1st year…
Instructions Present Value Tables Chart of Accounts Journal Final Questions Instructions Campbell Inc. produces and sells outdoor equipment. On July 1, Year 1, Campbell Inc. issued $60,400,000 of 10-year, 12% bonds at a market (effective) interest rate of 11%, receiving cash of $64,009,069. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1.* 2. Journalize the entries to record the following:* a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond premium, using the straight-line method. (Round to the nearest dollar.) b. The interest payment on June 30, Year 2, and the amortization of the bond premium, using the straight-line method. (Round to the nearest dollar.) 3. Determine the total interest expense for Year 1. 4. Will the bond proceeds always be…
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Question Content Area The following information relates to the Davensmith Company: Interest payable, beginning of period $ 60 Bond discount amortization, end of period 40 Interest payable, end of period 10 Total interest expense reported on the income statement 850 Bond discount amortization, beginning of period 70 What was the amount of interest paid? $820 $870 $830 $850