Problem 14- 8A Bond premium amortization and finding the present value of remaining cash flows LO6Calculations Marketing Inc. issued 10.5% bonds with a par value of $350,000and a five-year life on January 1, 2023, for $356, 757. The bonds pay interest on June 30 and December 31. The market interest rate was 10% on the original issue date. UseTABLE 14A.1 and TABLE 14A.2. (Use appropriate factor(s) from the tables provided.) Required:1. Calculate the total bond interest expense over the life of the bonds.2. Prepare anamortization table using the effective interest method. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)3. Show the journal entriesthat Calculations Marketing Inc. would make to record the first two interest payments assuming a December 31 year - end. (Do not round intermediate calculations. Round the finalanswers to the nearest whole dollar.)4. Use the original market interest rate to calculate the present value of the remaining cash flows for these bonds as of December 31, 2025.Compare your answer with the amount shown on the amortization table as the balance for that date. (Do not round intermediate calculations. Round the final answers to thenearest whole dollar.)

Total bond interest expense over the life of the bonds:Cash paid for interest = Face value of the…

Answered: The bonds pay interest on June 30 and…

The bonds pay interest on June 30 and Decembe or(s) from the tables provided.) Required: 1. Calcula (Do not round intermediate calculations. Round th

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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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
On January 1, 2021, Madison Products issued $70 million of 6%, 10-year convertible bonds at a net price of $70.9 million. Madison recently issued similar, but nonconvertible, bonds at 99 (that is, 99% of face amount). The bonds pay interest on June 30 and December 31. Each $1,000 bond is convertible into 30 shares of Madison's no par common stock. Madison records interest by the straight-line method. On June 1, 2023, Madison notified bondholders of its intent to call the bonds at face value plus a 1% call premium on July 1, 2023. By June 30 all bondholders had chosen to convert their bonds into shares as of the interest payment date. On June 30, Madison paid the semiannual interest and issued the requisite number of shares for the bonds being converted. In this question, combine the discount on the bonds with the face amount, and record the net amount as bonds payable. This is the "net method." When the net method is used, the discount (or premium) is amortized directly to the bonds…
Entries for Bonds Payable, induding bond redemption The following transactions were completed by Montague Inc., whose fiscal year is the calendar year:
Part 1 Prepare 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, 2023 b. Payment of interest on December 1, 2023 c. Adjusting entry to accrue bond interest and discount amortization on January 31, 2024 d. Payment of interest on June 1, 2024 Assume JetCom Inventors Inc. has a January 31 year-end. View transaction list Journal entry worksheet 1 2 3 4 Record issued bond at discount. Note: Enter debits before credits. Date June 01, 2023 General Journal Debit Credit >
Sheridan Inc. is building a new hockey arena at a cost of $2,150,000. It received a down payment of $430,000 from local businesses to support the project, and now needs to borrow $1,720,000 to complete the project. It therefore decides to issue $1,720,000 of 10- year, 10.5% bonds. These bonds were issued on January 1, 2023, and pay interest annually on each January 1. The bonds yield 10.5% to the investor and have an effective interest rate to the issuer of 10.40530%. (There is an increased effective interest rate due to the capitalization of the bond issue costs.) Any additional funds that are needed to complete the project will be obtained from local businesses. Sheridan paid and capitalized $43,000 in bond issuance costs related to the bond issue. Sheridan prepares financial statements in accordance with IFRS.
journal entries I need help with I can not understand (a)Record the bond issue (b)Record the first semiannual interest payment. (c)Record the second semiannual interest payment.
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
Entries for Issuing Bonds and Amortizing Discount by Straight-Line Method On the first day of its fiscal year, Chin Company issued $26,500,000 of five-year, 12% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 13%, resulting in Chin receiving cash of $25,547,585. a. Journalize the entries to record the following: 1. Issuance of the bonds. 2. First semiannual interest payment. The bond discount is combined with the semiannual interest payment. (Round your answer to the nearest dollar.) 3. Second semiannual interest payment. The bond discount is combined with the semiannual interest payment. (Round your answer to the nearest dollar.) If an amount box does not require an entry, leave it blank. 1. 2. 3. 300 000 000 000 000 b. Determine the amount of the bond interest expense for the first year.
The balance in Unamortized Discount on Bonds Payable should be Oa. reported separately in the Current Liabilities section of the balance sheef Ob. 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.
Record the bond issue record the first semiannual interest payment record the second semiannual interest payment
Indicate the proper financial statement classification for each of the following accounts: Financial Statement Statement Classification Discount on Long-term Bonds Payable Answer Answer Mortgage Notes Payable Answer Answer Long-term Bonds Payable Answer Answer Bond Interest Expense Answer Answer Bond Interest Payable Answer Answer Premium on Long-term Bonds Payable Answer
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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