Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations. Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value. Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate. Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value. To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

Question

How much interest expense is incurred?? Financial accounting

Answer 1

Question

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

d)

To determine

The amount of bond interest expense for first year.

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How much interest expense is incurred?? Financial accounting

A firm with no net debt reports cash flow from operations of $5,400 million in its cash flow statement after adding $1,700 million in accruals to earnings. It reported cash investments in operations of $3,200 million. What were the firm's free cash flow and earnings for the period? a. Free cash flow: $2,200 million; Earnings: $3,700 million b. Free cash flow: $2,000 million; Earnings: $3,900 million c. Free cash flow: $2,200 million; Earnings: $3,900 million d. Free cash flow: $2,000 million; Earnings: $3,700 million

Need help with this question solution general accounting

Answer 2

Question

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

d)

To determine

The amount of bond interest expense for first year.

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Answer 3

Question

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

d)

To determine

The amount of bond interest expense for first year.

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Answer 4

Question

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

d)

To determine

The amount of bond interest expense for first year.

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Answer 5

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

d)

To determine

The amount of bond interest expense for first year.

Answer 6

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

Answer 7

Chapter 12, Problem 12.25EX

a)

To determine

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.

Effective-interest method of amortization: It is an amortization model that apportions the amount of bond discount or premium based on the market interest rate.

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

To Calculate: The amount of cash proceeds (present value) from the sale of the bonds.

Answer 8

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

Answer 9

b)

To determine

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

Answer 10

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

Answer 11

c)

To determine

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

Answer 12

d)

To determine

The amount of bond interest expense for first year.

Answer 13

d)

To determine

The amount of bond interest expense for first year.

Answer 14

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Answer 25

Ch. 12 - Describe the two distinct obligations incurred by...Ch. 12 - Explain the meaning of each of the following terms...Ch. 12 - Prob. 3DQ Ch. 12 - A corporation issues 26,000,000 of 9% bonds to...Ch. 12 - Prob. 5DQ Ch. 12 - The following data relate to a 2,000,000, 8% bond...Ch. 12 - Prob. 7DQ Ch. 12 - Prob. 8DQ Ch. 12 - Fleeson Company needs additional funds to purchase...Ch. 12 - Prob. 10DQ

Solution Summary: The author explains the effective-interest method of amortization, which apportions the amount of bond discount or premium based on the market interest rate.

To Calculate: The amount of premium to be amortized for the first semiannual interest payment period.

To Calculate: The amount of premium to be amortized for the second semiannual interest payment period.

The amount of bond interest expense for first year.

Chapter 12 Solutions