Stephanie Ram Corporation have a $1,120,000 "bond issue" dated February 1, 2016 due in 10 years with an annual interest rateof 9%. Interest is payable February 1 and August 1. On April 1, 2016, the bond was sold for $1,078,700 plus accrued interest.Using the straight-line method, prepare the general journal entries for each of the following:a)The issuance of the bond on April 1, 2016.b)Payment of the semi-annual interest and the amortization of the discount on August 1, 2016.c)Accrual of the interest and the amortization of the discount on December 31, 2016.d)Payment of the semi-annual interest and the amortization of the discount on February 1, 2017.

a) Issuance of the Bond on April 1, 2016Debit: Cash ($1,078,700)Credit: Bonds Payable…

Answered: Stephanie Ram Corporation have a…

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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BlueLtd. Issued a $1,164,000, 10-year bond dated January 1, 2020. 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 Blue 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 tactor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITYOF 1 (For calculation purposes, use 5 decimal places as displayed in the factor table provided and final answers to 0 decimal places, e.g. 5,275.) Proceeds from sale of bond : on bond Prepare the journal entries for above transactions. (Round answers to 0 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 0 for the…
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