The balance in Unamortized Discount on Bonds Payable should beOa. reported separately in the Current Liabilities section of the balance sheefOb. added to the face amount of the related bonds payable on the balance sheet.O C. reported in the Paid-In Capital section of the balance sheet.Od. reported on the balance sheet as a deduction from the face amount of the related bonds payable.

Unamortized discounts on bonds payable are considered as a decrease in carrying value or book value…

Answered: The balance in Unamortized Discount on…

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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Which of the following would NOT be included in the journal entry to show the conversion of bonds payable? O A credit to additional paid in capital O A debit to bonds payable O A debit to bond premium O A credit to gain on conversion
When bonds are issued at a discount and the effective interest method is used for amortization, at each successive interest payment date, the interest expense: Select one: a. Increases b. Is equal to the change in market value of the bonds c. Decreases d. Is equal to the change in carrying value of the bonds e. Stays the same
The carrying value of Bonds Payable equalsa. Bonds Payable plus Discount on Bonds Payable.b. Bonds Payable minus Discount on Bonds Payable.c. Bonds Payable minus Premium on Bonds Payable.d. Bonds Payable plus Accrued Interest.
The journal entry a company makes for the issuance of bonds when the contract rate is less than the market rate would be Oa. debit Cash and Discount on Bonds Payable, credit Bonds Payable Ob. debit Cash, credit Bonds Payable Oc. debit Cash, credit Premium on Bonds Payable and Bonds Payable Od. debit Bonds Payable, credit Cash
Describe the accounting for bonds payable, including bonds issued at face amount, bonds issued at a discount , nd bonds issued at a premium ?
A $2,600 credit balance in the Premium on Bonds Payable account represents which of the following? Select one: a. An overpayment for a bond purchase b. An underpayment for a bond purchase c. The current amount of amortization expense d. The unamortized amount of premium earned on a bond issue
When a company uses the the effective-interest method to amortize a bond discount amortization, the interest expense is equal to a) the market rate multiplied by the beginning-of-period carrying amount of the bonds. b) the market rate of interest multiplied by the face value of the bonds. c) the stated rate multiplied by the beginning-of-period carrying amount of the bonds. d) the stated (nominal) rate of interest multiplied by the face value of the bonds.
If the sale of bonds falls between interest dates, interest accrued since the last interest payment would be O a. added to; debited to Interest Revenue O b. subtracted from; debited to Interest Revenue O c. subtracted from; credited to Interest Revenue O d. added to; credited to Interest Revenue the sale proceeds and
SHOW STEPS IN CALCULATING BONDS PAYABLE DISCOUNT
8. Discount on Note Payable should be classified as a a. current asset b. contra account to Notes Payable c. part of stockholder's equity d. deferred debt
Unamortized debt premium should be reported on the balance sheet of the insurer as a Group of answer choices direct addition to the face amount of the debt deduction from the issue costs deferred credit direct addition to the present value of the debt
Concord Hills Ltd. issued five-year bonds with a face value of $180,000 on January 1. The bonds have a coupon interest rate of 5% and interest is paid semi-annually on June 30 and December 31. The market interest rate was 3% when the bonds were issued at a price of 109. Determine the balance in the Bonds Payable account immediately following the first interest payment. Balance in bonds payable account

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