View PoliciesCurrent Attempt in ProgressCrane Company issued $920,000, 8-year bonds. It agreed to make annual deposits of $73,000 to a fund (called a sinking fund), whichwill be used to pay off the principal amount of the bond at the end of 8 years. The deposits are made at the end of each year into anaccount paying 5% annual interest.Click here to view the factor table.(For calculation purposes, use 5 decimal places as displayed in the factor table provided.)What amount will be in the sinking fund at the end of 8 years? (Round answer to 2 decimal places, e.g. 25.75.)Amount in the sinking fund $

Future Value of Annuity = Annual Payment * FV Factor(5%,8 years)Future Value of Annuity =…

Answered: View Policies Current Attempt in…

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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Similar questions

Thompson Distributors sold $50,000 worth of bonds to raise money for a new warehouse. The bonds pay interest annually at 4% for 10 years. The market rate of interest for a similar instrument was 3%; therefore, the bonds sold for a premium at $54,265. a. Record the sale of the bonds. b. Record the first interest payment and the amortization of the bond premium. Round the interest to the nearest dollar. c. Determine the carrying value (book value) of the bonds after the first year. General Journal Date Account Debit Credit a. b.
A Corporation sold an issue of 20-year bonds, having a total face value of 22M for 9,500,000. The bonds bear interest at 16%, payable semiannually. The company wishes to establish a sinking fund for retiring the bond issue and will make semiannual deposit that will earn 12%, compounded semiannually. Compute the annual cost for interest and redemption of these bonds.
On January 1 year 1, a company issues 7%, 10 year $300,000 par value bonds that pay annual interest on December 31 of every year. The bonds were issued at 104. Required: Calculate the total borrowing cost (financing cost) for the company, over the life of the bonds.
A company issues $75000 face value bonds with a state interest rate of 10% paying interest semi-annually and maturing in 5 years. the market rate on the date the bonds are issued is 8%. Complete the partial amortization schedule schedule provided, the journal entry at issuance, and the journal entry for the second interest payment.
3. A company issued 100 bonds of₱1,000 face value each, redeemable at par at the end of 15 years. To accumulate the funds for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund is 5%. What was the principal in the fund at the end of the 12thyear?
Answer it quickly with in 30 minutes
At the end of the year, the company purchased as a long-term investment P 10,000, 10% bonds to yield 8% per year. The bonds mature on January 1, five years after, and pay interest semiannually on June 30 and December 31. The present value factors are as follows: Present value of 1 at 4% for 10 periods 0.6756 Present value for an ordinary annuity at 4% for 10 periods 8.11 Present value of 1 at 5% for 10 periods 0.6139 Present value for an ordinary annuity at 5% for 10 periods 7.72 The carrying amount of this investment at year end is
K Optical Dispensary borrowed $960.000 on January 2, 2024, by issuing a 12% serial bond payable that must be paid in three equal annual installments plus interest for the year. The first payment of principal and interest comes due January 2, 2025 Complete the missing information. Assume bonds are issued at face value. (For accounts with a 50 balance, make sure to enter to in the appropriate cell) Current Liabilities Bonds Payable Interest Payable Long-Term Liabilities: Bonds Payable 2024 December 31 2025 2026
a corporation sold an issue of 15 years bonds having a total face value of 12,000,000 for 11,000,000. the bond bear interest 15% payable semiannually . the company wishes to established a sinking fund for retiring the bond issue and will make semiannual deposit that will earn 12% compunded seminuannually. show the cash flow diagram and compute the annual costfor interest and redemption of these bond.
Oak Branch Inc. issued $900,000 of 5%, 10-year bonds when the market rate was 4%. They received $973,595. Interest was paid semi-annually. Prepare an amortization table for the first three years of the bonds. Round intermediate and final answers to whole dollar amount. Jan. 1, Year 1 June 30, Year 1 Dec. 31, Year 1 June 30, Year 2 Dec. 31, Year 2 June 30, Year 3 Dec. 31, Year 3 Cash Interest Payment ✔ 22,500 22,500 ✓ 22,500 ✔ 22,500 ✔ 22,500 ✓ 22,500 ✓ Interest on Carrying Value 19,472 19,411 V ✓ 19,350 ✔ 19,287 ✔ 19,222 ✔ 19,157 ✔ Amortization of Premium 3,028 3,089 3,150 ✔ ✓ 3,213 3,278 ✓ 3,343 ✔ Carrying Value 973,595 970,567 967,478 ✔ 964,328 ✔ 961,114 X 957,837 ✔ 954,493 X
Sepia Inc. issued $350,000 bonds that were redeemable in 7 years. They established a sinking fund that was earning 5.50% compounded semi-annually to pay back the principal of the bonds on maturity. Deposits were being made into the fund at the end of every 6 months. a. Calculate the size of the periodic sinking fund deposits. b. Calculate the sinking fund balance at the end of the 4th payment period. c. Calculate the amount of interest earned during the 5th payment period. d. Calculate the amount by which the sinking fund increased in the 5th payment period.
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?

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