The issue price of bonds

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Answer 1

Question

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

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Answer 2

Question

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Expert Solution & Answer

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Answer 3

Question

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Expert Solution & Answer

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See solution

Answer 4

Question

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Expert Solution & Answer

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Answer 5

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Answer 6

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

Answer 7

Chapter 9, Problem 9.74AP

1.

To determine

To identify: The issue price of bonds

Answer 8

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

Answer 9

2.

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.

Stated interest rate: It refers to the interest rate that is stated on the face of the bonds.

Market interest rate: It refers to the interest rate that the lenders expect, or demands from the borrower to part with their money as loan to them.

To identify: The issue price of bonds

Answer 10

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

Answer 11

3.

(a)

To determine

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

Answer 12

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

Answer 13

(b)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

Answer 14

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

Answer 15

(c)

To determine

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

Answer 16

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

Answer 17

(d)

To determine

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

Answer 18

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Answer 19

4.

To determine

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

Answer 20

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Answer 21

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Answer 22

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Answer 23

Ch. 9 - Prob. 1QC Ch. 9 - Prob. 2QC Ch. 9 - Prob. 3QC Ch. 9 - Prob. 4QC Ch. 9 - A contingent liability should be recorded in the...Ch. 9 - Prob. 6QC Ch. 9 - Prob. 7QC Ch. 9 - Prob. 8QC Ch. 9 - Prob. 9QC Ch. 9 - Prob. 10QC

The issue price of bonds

To identify: The issue price of bonds

To prepare: Journal entry to record the issuance of the bonds on February 28, 2016.

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on August 31, 2016.

To prepare: Journal entry for accrual of interest and bond discount amortization on December 31, 2016.

To prepare: Journal entry to record the payment of interest and amortization of bonds discount on February 28, 2017.

To Report: Interest payable and bonds payable on Company M’s balance sheet at December 31, 2016.

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