When Patey Pontoons issued 6% bonds on January 1, 2024, with a face amount of $600,000, the market yield for bonds of similar risk and maturity was 7%. The bonds mature December 31, 2027 (4 years). Interest is paid semiannually on June 30 and December 31. Required: Determine the price of the bonds at January 1, 2024. Prepare the journal entry to record their issuance by Patey on January 1, 2024. Prepare an amortization schedule that determines interest at the effective rate each period. Prepare the journal entry to record interest on June 30, 2024.

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

Q: On January 1, 2020, the Rangler Company issued $600,000 of eight-year bonds at 102. The stated…

A: Cash(600000*102/100) Dr $612000 Bond payable  Cr                      $600000 Premium on issue   Cr.…

Q: Agee Technology, Inc., issued 9% bonds, dated January 1, with a face amount of $1,400 million on…

A: The journal entries are prepared to keep the record of day to day transactions of the business. The…

Q: When Patey Pontoons issued 8% bonds on January 1, 2024, with a face amount of $700,000, the market…

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

Q: russels Enterprises issues bonds at par dated January 1, 2021, that have a $2,500,000 par value,…

A: Bonds payable are one of the sources of finance and are shown as a liability. If the interest rate…

Q: Super Splash issues $870,000, 7% bonds on January 1, 2021, that mature in 15 years. The market…

A: Semiannual interest payment = Face value of bonds x rate of interest x no. of months/12 = $870,000 x…

Q: On January 1, 2022, Kristopher Co. issued ten-year bonds with a face value of $6,000,000 and a…

A: The bonds are the financial instruments of the business. The bonds are reported as long term…

Q: The Bradford Company issued 10% bonds, dated January 1, with a face amount of $82 million on January…

A: Issue price of bonds would be the present value of the interest annuity & maturity amount at…

Q: Brussels Enterprises issues bonds at par dated January 1, 2019, that have a $3,400,000 par value,…

A: When the bonds are issued at par, then there shall be no premium or discount on bonds payable.

Q: Prepare a bond interest expense and premium amortization schedule using the straight-line method. 2.…

A: Under the Straight line method, a Bond premium or discount is amortized equally over the bond term…

Q: On January 1, 2024, Instaform, Incorporated, issued 10% bonds with a face amount of $48 million,…

A: "Bonds" refer to debt securities that are typically issued by corporations, governments, or other…

Q: On January 1, 2018, Baddour, Inc., issued 10% bonds with a face amount of $160 million. The bonds…

A: Requirement 1:   Compute the amount of liability.

Q: When Patey Pontoons issued 10% bonds on January 1, 2024, with a face amount of $560,000, the market…

A: Net present value:Calculation used to evaluate the investment and financing decisions that involve…

Q: Brussels Enterprises issues bonds at par dated January 1, 2019, that have a $2,500,000 par value,…

A: Bonds payable are one of the sources of finance and are shown as liability. If the interest rate is…

Q: Most Solutions, Incorporated, issued 13% bonds, dated January 1, with a face amount of $640 million…

A: Cash flow statement is one of financial statements includes three activities.Cash flow from…

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A: The financial instrument which provides fixed interest as a return over the period of investment is…

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A: Bonds meaning:- Bonds are debt securities or financial instruments issued by governments,…

Q: On January 1, 2021, Bishop Company issued 10% bonds dated January 1, 2021, with a face amount of $20…

A: Coupon rate = 10%Face amount = $20,000,000Yield = 12%Maturity = 20 yearsTo find: The amounts…

Q: The Bradford Company issued 10% bonds, dated January 1, with a face amount of $80 million on January…

A: Since we are entitled to answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the…

Q: The Gonzalez Group issued $980,000 of 9% bonds on June 30, 2024, for $1,076,985. The bonds were…

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

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A: 1.

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A: We have the following information of the Gorman Group: 9% $860,000 bonds issued for $945,110…

Q: The Gorman Group issued $810,000 of 11% bonds on June 30, 2021, for $879,498. The bonds were dated…

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Q: Brussels Enterprises issues bonds at par dated January 1, 2021, that have a $2,500,000 par value,…

A: Bonds are the securities issued by the entity for the purpose of raising funds from the market.…

Q: When Patey Pontoons issued 10% bonds on January 1, 2024, with a face amount of $560,000, the market…

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

Q: Ellis Company issues 6.5%, five-year bonds dated January 1, 2019, with a $250,000 par value. The…

A: It is a fixed income instrument that represents a loan made by an investor to a borrower ( corporate…

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

Q: Agee Technology, Inc., issued 9% bonds, dated January 1, with a face amount of $400 million on July…

A:

Q: When Patey Pontoons issued 4% bonds on January 1, 2024, with a face amount of $660,000, the market…

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

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…

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Q: On January 1, 2020, Cullumber Company issued $400,000, 10%, 10-year bonds at face value. Interest is…

A: Bonds- These are the debts of a company on which interest is payable after a fixed interval i.e.…

Q: When Patey Pontoons issued 8% bonds on January 1, 2024, with a face amount of $700,000, the market…

A: Since you have posted a question with multiple sub parts, we will provide the solution only to the…

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Q: National Orthopedics Co. issued 9% bonds, dated January 1, with a face amount of $500,000 on January…

A: 1.

Q: On January 1, 2024, Instaform, Incorporated, issued 14% bonds with a face amount of $50 million,…

A: "Bonds" refer to debt securities that are typically issued by corporations, governments, or other…

Q: On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $200…

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Q: The Gorman Group issued $930,000 of 11% bonds on June 30, 2021, for $1,009,794. The bonds were dated…

A: Journal Entry :— It is an act of recording transaction in books of account when transaction…

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.