tives Limited plans to Issue $550,000, 10-year, 6.50 percent bonds. Interest is payable annually on December 31. All of e Issued on January 1, 2022. Show how the bonds would be reported on the January 2, 2022, balance sheet if they ar 3.

tives Limited plans to Issue $550,000, 10-year, 6.50 percent bonds. Interest is payable annually on December 31. All of e Issued on January 1, 2022. Show how the bonds would be reported on the January 2, 2022, balance sheet if they ar 3.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: On January 2, 2016, Banno Corp. issued P1,500,000 of 10% bonds to yield 11% due December 31, 2025.…

A: The answer is stated below:

Q: On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $460…

A: Lets understand the basics.Bonds payable are one of the sources of finance and are shown as…

Q: Universal Foods issued 8% bonds, dated January 1, with a face amount of $160 million on January 1,…

A: Commercial organizations used journal entries to record their financial transactions in their…

Q: CHINA Corporation, on January 1, 2021, issued 30,000, 10%, P100 bonds for P2,900,305. Principal…

A: As per effective interest method, the amount of interest expense correlates with the carrying value…

Q: On January 1, 2019, Drennen Inc. issued $5 million face amount of 10-year, 14% stated rate bonds…

A: Given: Face value= $5,000,000 i (Stated interest rate) = 14% n (Time period)= 10 x 2 = 20 Market…

Q: On June 1, 2018, Ken Company sold $200,000 in long-term bonds for $175,520. The bonds have a stated…

A: The bonds are issued at discount when market rate is higher than the coupon rate of bonds.

Q: On January 1, 2019, company acquired 2,000,000 face amound bonds dated January 1, 2022. The bonds…

A: Introduction' Bond is a investment securities that is issued by company where investors lends money…

Q: E-Tech Initiatives Limited plans to issue $500,000, 10-year, 4 percent bonds. Interest is…

Q: On June 30, 2024, Single Computers issued 8% stated rate bonds with a face amount of $100 million.…

A: Issue price of a bond means the price at which the bond is issued. It can be issued at par, premium…

Q: Provide the journal entry that Bella will make to record the second bond interest payment on…

A: Meaning of Bonds Bonds are fixed debt instruments where a company issues bonds to the lenders. The…

Q: E-Tech Initiatives Limited plans to issue $450,000, 10-year, 5 percent bonds. Interest is payable…

A: please like the answer your response matters Long term Liabilities: Bonds Payable $450,000…

Q: E-Tech Initiatives Limited plans to issue $500,000, 10-year, 5 percent bonds. Interest is payable…

A: One of the source used by the business organizations to fulfill their financial requirements is…

Q: On March 1, 2021, Baddour, Inc., issued 12% bonds, dated January 1, with a face amount of $165…

A: 1. Compute amount of bonds report in its balance sheet as shown below: Working note: Compute…

Q: A. On January 1, 2021, Bradley Company issued $100,000, 9%, 4-year bonds. Interest is paid…

Q: The law firm END, LLP provides legal services to a wide range of clients in the KC area. The firm…

Q: Frozen Company issues $34,800 of ten year bonds on January 1, 2020 at 108. It uses the straight line…

A: Financial statements are formal reports that summarize the financial performance, financial…

Q: On June 30, 2024, Single Computers issued 8% stated rate bonds with a face amount of $100 million.…

A: Bonds payable is a type of instrument where by an amount is borrowed for a fixed period with fixed…

Q: On June 1, 2018, Ken Company sold $200,000 in long-term bonds for $175,520. The bonds have a stated…

A: a.Bond Amortization table for first 4 year Period Ending Beginning of Period Net Book Value…

Q: Discount-Mart Issues $16 million in bonds on January 1, 2024. The bonds have a seven-year term and…

A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds payable. The…

Q: Discount-Mart issues $15 million in bonds on January 1, 2024. The bonds have a ten-year term and pay…

A: Cost which is incurred for funds borrowed by entity is referred to as interest expense. To put it…

Q: On January 1, 2025, Blue Company issued S1, 100, 000 face value, 7 %, 10-year bonds at $1, 180,961.…

A: Bonds payable are long-term liabilities that are issued for a fixed term with a fixed periodic…

Q: On January 1, 2021, Universe of Fun issues $900,000, 8% bonds that mature in 10 years. The market…

A: Bonds: This is just like debt for the issue of investors by the company. Bond is dependent on the…

Q: Frozen Company issues $33,600 of ten year bonds on January 1, 2020 at 108. It uses the straight line…

A: INTRODUCTION: When bonds are issued, cash is received, and bonds payable are credited. But, if a…

Q: Dok int ences E-Tech Initiatives Limited plans to issue $640,000, 10-year, 6.50 percent bonds.…

A: Issuing bonds at a premium occurs when a company sells its bonds to investors at a price exceeding…

Q: On March 1, 2024, Baddour, Incorporated, issued 10% bonds, dated January 1, with a face amount of…

A: Bonds payable refer to the debt instrument which is issued for fundraising. A company can issue…

Q: E-Tech Initiatives Limited plans to issue $400,000, 10-year, 4 percent bonds. Interest is payable…

A: Carrying value is an accounting measure of value in which the value of an asset or company is based…

Q: E-Tech Initiatives Limited plans to issue $500,000, 10-year, 4 percent bonds. Interest is payable…

A: Number of bonds=Total valuePar value=$500,000$100=5,000

Q: E-Tech Initiatives Limited plans to issue $550,000, 10-year, 3 percent bonds. Interest is payable…

A: The bonds have a face value of $500,000 and are issued at 95% of the face value.Issue Price = Face…

Q: E-Tech Initiatives Limited plans to issue $450,000, 10-year, 4 percent bonds. Interest is payable…

A: Bonds Payable issued at discount - Bonds payable is the obligation of the company to be paid at the…

Q: E-Tech Initiatives Limited plans to issue $400,000, 10-year, 4 percent bonds. Interest is payable…

A: Carrying value is an accounting measure of value in which the value of an asset or company is based…

Q: On July 1, 2022, Free Compnay issued for $438,000, 500 of its 8%, $1000 bonds. The market rate when…

A: The bonds are the financial instruments that are used to raise money from the market or investors.…

Q: Quick Lane Auto Service issued $50,000, 10-year bonds on January 1, 2021. of interest on the bonds…

A: Bonds payable are always recorded at the par value of the bonds. Discount or premium on bonds…

Q: On March 1, 2024, Baddour, Incorporated, issued 10% bonds, dated January 1, with a face amount of…

A: The discount or premium on an issued bond is amortized to find the carrying value of the bond…

Q: izy Company issued $1,000,000 of 3-year, 10% bonds on January 1, 2023. The bonds pay interest…

A: 1.Initial measurement of financial instruments : Under IFRS 9, all financial instruments are…

Q: Universal Foods issued 10% bonds, dated January 1, with a face amount of $170 million on January 1,…

A: Answer:- Journal entry:- The act of maintaining or creating records of any transactions, whether…

Q: Questions: 1. How much is the estimated purchase price of the bonds on January 1, 2021? 2. Compute…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Universal Foods issued 12% bonds, dated January 1, with a face amount of $125 million on January 1,…

A: Bond :— It is one of the source of capital that pays fixed periodic interest and face value amount…

Q: On January 1, 2021, Lambda, Inc. issued ten-year bonds with a face value of $1,000,000 and an annual…

A: Bonds issued at discount: Bonds are said to be issued at discount if the issue price is less than…

Q: the second interest payment. January 31, 2034 the date the principal is repaid. What would be the…

A: Scenario 1: Bonds Issued February 1, 20241. Amount Received:Face value of bonds: 80,000 * $1,000 =…

Q: On January 1, 2018, Paradiso Company issued 1,000 of its 8%, $1,000 bonds at 93. Interest is payable…

A: Definition: Bonds: Bonds are a kind of interest-bearing notes payable, usually issued by…

Q: E-Tech Initiatives Limited plans to issue $650,000, 10-year, 7.00 percent bonds. Interest is payable…

A: Journal entry to record Issuance of bonds payable:

Q: Donner Corporation issues 4-year bonds with a face value of $5,000,000 and a stated rate of 5% on…

A: Interest Expenses are calculated on book value of bonds as per market rate of interest i.e. 6%

Q: On March 1, 2021, JebaMac Company issued 6% term bonds with a face amount of P1,000,000 due March 1,…

A: Jeba Company has recognized the bond payable as per amortized cost method using the effective…

Q: On January 1, 2024, Splash City issues $500,000 of 9% bonds, due in 20 years, with interest payable…

A: The carrying value of a bond refers to the amount at which the bond is recorded on the balance sheet…

Q: On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $280…

A: Bonds payable refers to a type of long-term debt that a company or organization issues to borrow…

Q: Last August 7, 2021, Violet Company issued 2,000 shares of its P10 par value ordinary share capital…

A: The shares can be issued by the business for cash or to acquire non cash assets. The non cash…

Q: At January 1, 2020, Konerko Corp. issued $40,000,000 of 6%, 12-year bonds that paid interest…

A: Bonds: It is also known as fixed-income security, is a debt instrument created for the purpose of…

Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

E-Tech Initiatives Limited plans to issue $550,000, 10-year, 6.50 percent bonds. Interest is payable annually on December 31. All of the
bonds will be issued on January 1, 2022. Show how the bonds would be reported on the January 2, 2022, balance sheet if they are
Issued at 103.
E-TECH INITIATIVES LIMITED
Balance Sheet (partial)
As of January 2, 2022
Carrying Value
$
0

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Working notes for the calculation of the balance sheet amount

VIEW

Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $200 million. The bonds mature on September 30, 2044 (20 years). The market rate of interest for similar bonds was 10%. Interest is paid semiannually on March 31 and September 30. Required: Determine the price of the bonds on September 30, 2024. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount, not in millions. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Time values are based on: n= i= Cash Flow Interest Principal Price of bonds S S Amount 40 5% 8,000,000 200,000,000 Present Value
Complex Solution Company issues P2 M face value, 9%, 10-year bonds payable on December 31, 2023. Interest is paid semi-annually each June 30 and December 31. The bonds were sold at a price of 98. Complex uses the straight-line method of amortizing bond discounts and premium. **Compute for Amount of Bond Premium or Discount on December 31, 2023. **Bond Interest Expense for 2024 with respect to these bonds **Carrying Value of the bonds as of December 31, 2024.
The following section is taken from Crane's balance sheet at December 31, 2024. Current liabilities Interest payable Long-term liabilities Bonds payable (9%, due January 1, 2028) (a) (b) $41,000 Interest is payable annually on January 1. The bonds are callable on any annual interest date. (c) 510,000 Journalize the payment of the bond interest on January 1, 2025. Assume that on January 1, 2025, after paying interest, Crane calls bonds having a face value of $105,000. The call price is 105. Record the redemption of the bonds. Prepare the adjusting entry on December 31, 2025, to accrue the interest on the remaining bonds.
On January 1, 2019, Company C issues $200,000 of its 6% bonds which mature in 10 years. Interest is paid annually on December 31. The market (effective) rate of interest is 4%. If the bond sells as 88.2, what the amount of interest expense reported on the Income Statement for 2019 (hint: prepare an amortization schedule)
Shaq Corporation issued $10,000 of 20-year bonds on January 1, 2024. The bonds pay interest semiannually. This is a partial bond amortization schedule for the bonds. Payment Cash Effectiveinterest Increase in balance Outstandingbalance 9,080 1 400 409 9 9,089 2 400 409 9 9,098 3 400 409 9 9,107 4 400 410 10 9,117 What is the effective annual rate of interest on the bonds?
Discount-Mart issues $12 million in bonds on January 1, 2024. The bonds have a ten-year term and pay interest semiannually on June 30 and December 31 each year. Below is a partial bond amortization schedule for the bonds: Date 01/01/2024 06/30/2024 12/31/2024 06/30/2025 12/31/2025 Interest Expense $600,000 $637,417 HIT 639,662 642,041 644,564 Cash Paid 600,000 600,000 Increase in Carrying Value 600,000 $37,417 39,662 42,041 44,564 Carrying Value $10,623,609 10,661,026 10,700,688 10,742,729 10,787,293 What is the stated annual rate of interest on the bonds? (Hint: Be sure to provide the annual rate rather than the six-month rate.) (Do not round your intermediate calculations.)
help please
Frozen Company issues $31,800 of ten year bonds on January 1, 2020 at 108. It uses the straight line method of amortization and prepares annual financial statements on December 31st. (Keep two decimal places in all your intermediate calculations). Required 1: What is the carrying value of the bonds on 2020 Financial Statements? Required 2: What is the carrying value of the bonds on 2021 Financial Statements? Required 3: What is the carrying value of the bonds on 2024 Financial Statements?
On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $500 million. The bonds mature on September 30, 2044 (20 years). The market rate of interest for similar bonds was 10%. Interest is paid semiannually on March 31 and September 30. Required: Determine the price of the bonds on September 30, 2024. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount, not in millions. (FV of $1. PV of $1, FVA of $1, PVA of $1. FVAD of $1 and PVAD of $1) Time values are based on: Cash Flow Interest Principal Price of bonds Amount Present Value
Aggies Inc. issued bonds with a $450,000 face value, 8% interest rate, and a 4-year term on July 1, 2018, and received $510,000. Interest is payable semi-annually. The premium is amortized using the straight-line method. A. July 1, 2018: entry to record issuing the bonds B. Dec. 31, 2018: entry to record payment of interest to bondholders C. Dec. 31, 2018: entry to record amortization of premium Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank. A. fill in the blank 2 fill in the blank 3 fill in the blank 5 fill in the blank 6 fill in the blank 8 fill in the blank 9 B. fill in the blank 11 fill in the blank 12 fill in the blank 14 fill in the blank 15 C.
On March 1, 2024, Baddour, Incorporated, issued 10% bonds, dated January 1, with a face amount of $160 million. The bonds were priced at $142.00 million (plus accrued interest) to yield 12%. The price if issued on January 1 would have been $139.25 million. Interest is paid semiannually on June 30 and December 31. Baddour’s fiscal year ends September 30. Required: 1. to 3. What would be the amount(s) related to the bonds Baddour would report in its balance sheet, income statement and statement of cash flows for the year ended September 30, 2024?
Ivanhoe Corporation has issued three different bonds during 2024. Interest is payable annually on each of these bonds. (a) Your answer is partially correct. On January 1, 2024, Ivanhoe issued 1,050, 8%, 5-year, $1,000 bonds dated January 1, 2024, at face value. Prepare the journal entry to record the bond transaction at the date of issue. (List debit entry before credit entry. 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 O for the amounts.) Date Account Titles Debit Credit Jan. 1 Cash Bonds Payable