Year 1 Issued $74,000,000 of 20-year, 11% callable bonds dated July 1, July Year 1, at a market (effective) rate of 139%, receiving cash of 1 $65,532,267. Interest is payable semiannually on December s1 and June 30. Borrowed $200,000 by issuing a six-year, 6% installment note to Oct. Nicks Bank. The note requires annual payments of $40,675, with the first payment occurring on September 30, Year 2. 1 Dec. Accrued $s,000 of interest on the installment note. The interest is payable on the date of the next installment note payment. s1 Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannual interest payment. si Year 2 Paid the semiannual interest on the bonds. The bond discount June amortization of $261,693 is combined with the semiannual so interest payment. Sept. Paid the annual payment on the note, which consisted of so interest of $12,000 and principal of $28,678. - Accrued $2,570 of interest on the installment note. The Dec. interest is payable on the date of the next installment note si payment. Paid the .semiannual interest on the bonds. The bond discount si amortization of $261,693 is combined with the semiannual interest payment. Year Recorded the redemption of the bonds, which were called at June 98. The balance in the bond discount account is $9,420,961 after payment of interest and amortization of discount have been recorded. Record the redemption only. so Sept. Paid the second annual payment on the note, which consisted so of interest of $10,280 and principal of $30,395.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

See similar textbooks

Related questions

Concept explainers

Question

Entries for bonds payable and installment note transactions
The following transactions were completed by Winklevoss Inc., whose
fiscal year is the calendar year

Instructions
1. Journalize the entries to record the foregoing transactions. Round all
amounts to the nearest dollar.
2. Indicate the amount of the interest expense in (a) Year 1 and (b) Year

2.
3. Determine the carrying amount of the bonds as of December 31, Year
2.

Year
1
Issued $74,000,000 of 20-year, 11% callable bonds dated July 1,
July Year 1, at a market (effective) rate of 139%, receiving cash of
1
$65,532,267. Interest is payable semiannually on December s1
and June 30.
Borrowed $200,000 by issuing a six-year, 6% installment note to
Oct.
Nicks Bank. The note requires annual payments of $40,675,
with the first payment occurring on September 30, Year 2.
1
Dec. Accrued $s,000 of interest on the installment note. The interest
is payable on the date of the next installment note payment.
s1
Paid the semiannual interest on the bonds. The bond discount
amortization of $261,693 is combined with the semiannual
interest payment.
si
Year
2
Paid the semiannual interest on the bonds. The bond discount
June
amortization of $261,693 is combined with the semiannual
so
interest payment.
Sept. Paid the annual payment on the note, which consisted of
so
interest of $12,000 and principal of $28,678.
- Accrued $2,570 of interest on the installment note. The
Dec.
interest is payable on the date of the next installment note
si
payment.
Paid the .semiannual interest on the bonds. The bond discount
si
amortization of $261,693 is combined with the semiannual
interest payment.
Year
Recorded the redemption of the bonds, which were called at
June 98. The balance in the bond discount account is $9,420,961
after payment of interest and amortization of discount have
been recorded. Record the redemption only.
so
Sept. Paid the second annual payment on the note, which consisted
so
of interest of $10,280 and principal of $30,395.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 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, operations-management and related others by exploring similar questions and additional content below.

Similar questions