(The following information applies to the questions displayed below.] On January 1, 2019, Drennen Inc. issued $3.1 million face amount of 7-year, 10% stated rate bonds when market interest rates were 8%. The bonds pay semiannual interest each June 30 and December 31 and mature on December 31, 2025. Table 6-4, Table 6-5 (Use appropriete factor from the table provided.) b-1. Assume instead that the proceeds were $3,052.000. Use the horizontal model to record the payment of semiannual interest and the related discount amortization on June 30, 2019, assuming that the discount of $48,000 is amortized on a straight-line basis. Indicate the financial statement effect. (Enter decrenses with a minus sign to indicate a negative financial statement effect.) Balance Sheet Income Statement Assets Liabilities + Stockholders' Equity Net Income Revenues Expenses

(The following information applies to the questions displayed below.] On January 1, 2019, Drennen Inc. issued $3.1 million face amount of 7-year, 10% stated rate bonds when market interest rates were 8%. The bonds pay semiannual interest each June 30 and December 31 and mature on December 31, 2025. Table 6-4, Table 6-5 (Use appropriete factor from the table provided.) b-1. Assume instead that the proceeds were $3,052.000. Use the horizontal model to record the payment of semiannual interest and the related discount amortization on June 30, 2019, assuming that the discount of $48,000 is amortized on a straight-line basis. Indicate the financial statement effect. (Enter decrenses with a minus sign to indicate a negative financial statement effect.) Balance Sheet Income Statement Assets Liabilities + Stockholders' Equity Net Income Revenues Expenses

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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Required information [The following information applies to the questions displayed below.) On January 1, 2024, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 6% and the bonds issued at $644,632 Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $633,887 on December 31, 2026. (Round your final answers to nearest whole dollar) Date 01/01/2024 06/30/2024 12/31/2024 06/30/2025 12/31/2025 06/30/2026 12/31/2026 Cash Paid Change in Expense Carrying Value Carrying Valua Check my wor
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.
On March 1, 2020, Quinto Mining Inc. issued a $690,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2020. 1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue 2. Using the effective interest method, prepare an amortization schedule. (Image attached) This question has a follow up, posted separately. Thanks!
answer is A: how do you get to this answers?
An accounting example: Otter Products inc issued bonds on January 1, 2019. Interest to be paid semi-annually. Term in years is 2; Face value of bonds issued is $200,000; Issue Price $206,000; Specified Interest Rate each payment period is 6% Question. Calculate a. the amount of interest paid in cash every payment period. b. The amount of amortization to be recorded at each interest payment date (use straight-line method) c. complete amoritzation table by calculating interest expense and beginning and ending bond carrying amounts at the each period over 2 years. The term is for 2 years however 3 years is showing on the workbook. How do I calcuate the 3rd year if the problem only says the term is 2 years?
! Required information [The following information applies to the questions displayed below.] Super Splash issues $900,000, 8% bonds on January 1, 2024, that mature in 20 years. The market interest rate for bonds of similar risk and maturity is 7%, and the bonds issue for $996,098. Interest is paid semiannually on June 30 and December 31. Required: 1. Complete the first three rows of an amortization schedule. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar.) Answer is complete but not entirely correct. Cash Date Paid Interest Expense Change in Carrying Value Carrying Value 1/1/2024 $ 996,098 6/30/2024 36,000 34,863 1,137 994,961 12/31/2024 36,000 34,890 1,110 x 993,851
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