!Required information[The following information applies to the questionsdisplayed below.]Cron Corporation is planning to issue bonds with a facevalue of $840,000 and a coupon rate of 13 percent. Thebonds mature in five years and pay interest semiannuallyevery June 30 and December 31. All of the bonds were soldon January 1 of this year. Cron uses the effective-interestamortization method. Assume an annual market rate ofinterest of 12 percent. (FV of $1, PV of $1, FVA of $1, andPVA of $1) (Use the appropriate factor(s) from the tablesprovided.)2. What amount of interest expense should be recorded on June 30 andDecember 31 of this year? (Round your final answers to nearest wholedollar amount.)Interest expenseJune 30December 31

BondsBonds are units of a company's debt that are issued by the company and packaged as tradable…

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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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Bringham Company issues bonds with a par value of $660,000 on their stated issue date. The bonds mature in 10 years and pay 9% annual interest in semiannual payments. On the issue date, the annual market rate for the bonds is 12%. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided.) 1. What is the amount of each semiannual interest payment for these bonds?2. How many semiannual interest payments will be made on these bonds over their life?3. Use the interest rates given to select whether the bonds are issued at par, at a discount, or at a premium.4. Compute the price of the bonds as of their issue date.5. Prepare the journal entry to record the bonds’ issuance.
The following information applies to this question: Johnson Corporation plans to obtain financing with a $1,000,000 bond issue that has a term of 10 years. Payments wilI be made semi-annually. if the bond (payment) rate is stated at 7%, and the bonds call for semi-annual payments, what is the amount of those payments? O a. $350,000 O b. $70,000 OC. $35,000 d. $700,000
On January 1, 2024, Christmas Anytime issues $850,000 of 6% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. Assume that the market interest rate is 7% and the bonds issue at a discount.2a. Calculate the issue price of a bond.2b. Complete the first three rows of an amortization schedule. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
Rosh Corporation is planning to issue bonds with a face value of $860,000 and a coupon rate of 10 percent The bonds mature in four years and pay interest semiannually every June 30 and December 31. All of the bonds will be sold on January 1 of this year (EV of $1. PV of $1. FVA of $1. and PVA of $1) (Use the appropriate factor(s) from the tables provided. Round your final answers to nearest whole dollar amount.) Required: Compute the issue (sales) price on January 1 of this year for each of the following independent cases: a. Case A: Market interest rate: 10 percent. Insue price b. Case B: Market Interest rate: 8 percent apd anss c. Case C: Market interest rate: 12 percent. IPoue prce
On January 1, 2023, ABC Company issued $60,000,000 of 20-year, 9.5% bonds when the market rate of interest was 10.25%. Interest is paid semi-annually on June 30 and December 31. Required: Using Excel compute the price at which the bond was issued. Using Excel and the effective interest method of bond amortization prepare an amortization table for the entire life of the bond issue. You are expected to do all calculations in Excel (What are the excel Formulas) Prepare ALL journal entries for the following dates: January 1, 2023, June 30, 2023, December 31, 2023, and December 31, 2042
When the market rate of interest was 12%, Halprin Corporation issued $395,000, 11%, four-year bonds that pay interest annually. The selling price of this bond issue was _____. Use the following table, if needed. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 0.90703 0.89000 0.87344 0.82645 0.79719 3 0.86384 0.83962 0.81630 0.75132 0.71178 4 0.82270 0.79209 0.76290 0.68301 0.63552 5 0.78353 0.74726 0.71299 0.62092 0.56743 6 0.74622 0.70496 0.66634 0.56447 0.50663 7 0.71068 0.66506 0.62275 0.51316 0.45235 8 0.67684 0.62741 0.58201 0.46651 0.40388 9 0.64461 0.59190 0.54393 0.42410 0.36061 10 0.61391 0.55840 0.50835 0.38554 0.32197 Present Value of an Annuity of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 1.85941 1.83339 1.80802 1.73554 1.69005 3 2.72325 2.67301 2.62432 2.48685 2.40183 4 3.54595 3.46511 3.38721 3.16987 3.03735 5 4.32948…
1. Use the present value tables to calculate the issue price and make the journal entry of a $100,000 bond issue in each of the following independent cases. Assume that the bond was issued on January 1, 2010 and that interest is paid semi-annually on June 30 and December 31. E) A 20-year,10 percent bond issue; the market interest rate is 6 percent F) A 15-year,12 percent bond issue; the market interest rate is 10 percent G) A 15-year, 10 percent bond issue; the market interest rate is 12 percen
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.
The Lex Corporation issued a new series of bonds on January 1, 2000. These bonds were sold at par, have a 12 percent coupon and mature in 30 years, on December 31, 2029. Coupon payments are made on June 30 and December 31. Assume that you purchased an outstanding Lex bond on March 1, 2023, when the going rate of interest was 15.5 percent. How large a check must you have written to complete the transaction?
ABC Inc. plans to issue $500,000 face value bonds with a stated interest rate of 12% and market interest rate of 10%. They will mature in 10 years. Interest will be paid semiannually. At the date of issuance, compute the present value (bond issue price) of the future cash flows. Following are appropriate factors from tables:
When the market rate of interest was 12%, Halprin Corporation issued $346,000, 11%, four-year bonds that pay interest annually. The selling price of this bond issue was _____. Use the following table, if needed. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 0.90703 0.89000 0.87344 0.82645 0.79719 3 0.86384 0.83962 0.81630 0.75132 0.71178 4 0.82270 0.79209 0.76290 0.68301 0.63552 5 0.78353 0.74726 0.71299 0.62092 0.56743 6 0.74622 0.70496 0.66634 0.56447 0.50663 7 0.71068 0.66506 0.62275 0.51316 0.45235 8 0.67684 0.62741 0.58201 0.46651 0.40388 9 0.64461 0.59190 0.54393 0.42410 0.36061 10 0.61391 0.55840 0.50835 0.38554 0.32197 Present Value of an Annuity of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 1.85941 1.83339 1.80802 1.73554 1.69005 3 2.72325 2.67301 2.62432 2.48685 2.40183 4 3.54595 3.46511 3.38721 3.16987 3.03735 5 4.32948…
Marigold Inc. issues $4,100,000 of 7% bonds due in 10 years with interest payable at year-end. The current market rate of interest for bonds of similar risk is 10%. Click here to view factor tables. What amount will Marigold receive when it issues the bonds? (For calculation purposes, use 5 decimal places as displayed in the factor table provided and final answer to O decimal places, e.g. 458,581.) Amount received by Marigold when bonds were issued $ 10822

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