Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations. 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 amortization method: Effective-interest amortization method it is an amortization model that apportions the amount of bond discount or premium based on the market interest rate. To prepare : Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

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Answer 1

Question

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

3.

To determine

The amount of total interest expense for 2016.

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Calm Ltd has the following data relating tò two investment projects, only one of which mayb e s e l e c t e d :The cost of capital is 10 per cent, and depreciation is calculated using straight line method.a . Calculate for each of the project:i. Average annual accounting rate of return on average capital investedi i . Net Present Valuei l l . I n t e r n a l R a t e o f Returnb. Discuss the relative merits of the methods of evaluation mentioned above in (a).Q.4a . In the context of process costing, discuss the following concepts briefly, i . Equivalent unitsNormal lossill. Abnormal lossi v. Joint productsV . By productsb . Discuss the different types of standard costing and objectives of standard costing.

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What are total assets at the end of the year?

Answer 2

Question

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

3.

To determine

The amount of total interest expense for 2016.

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Answer 3

Question

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

3.

To determine

The amount of total interest expense for 2016.

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Answer 4

Question

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

3.

To determine

The amount of total interest expense for 2016.

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Answer 5

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

3.

To determine

The amount of total interest expense for 2016.

Answer 6

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

Answer 7

Chapter 14, Problem 14.6BPR

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

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

To prepare: Journal entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2016.

Answer 8

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

Answer 9

2(a)

To determine

To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

Answer 10

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

Answer 11

2(b)

To determine

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

Answer 12

3.

To determine

The amount of total interest expense for 2016.

Answer 13

3.

To determine

The amount of total interest expense for 2016.

Answer 14

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Answer 15

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Answer 16

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Answer 17

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Solution Summary: The author explains that bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing operations.

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To prepare: Journal entry to record first semiannual interest payment and amortization of bond premium on December 31, 2016.

To prepare: Journal entry to record second interest payment and amortization of bond discount on June 30, 2017.

The amount of total interest expense for 2016.

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