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1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue 2. Using the effective interest method, prepare an amortization schedule. (Image attached)

1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue 2. Using the effective interest method, prepare an amortization schedule. (Image attached)

College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter22: Corporations: Bonds
Section: Chapter Questions
Problem 8SPB: BONDS ISSUED AT FACE VALUE Ramona Arroyo Co. issued the following bonds: REQUIRED Prepare journal...
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On March 1, 2020, Quinto Mining Inc. issued a $690,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2020.

1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue

2. Using the effective interest method, prepare an amortization schedule. (Image attached)

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Period Cash Interest Period Interest Premium Unamortized Carrying Value Ending Paid Expense Amort. Premium Mar. 1/20 Sept. 1/20 Mar. 1/21 Sept. 1/21 Mar. 1/22 Sept. 1/22 Mar. 1/23 Totals $ 0 $ Record the entries for the issuance of the bond on March 1 th e adiusting entry to a
Transcribed Image Text:Period Cash Interest Period Interest Premium Unamortized Carrying Value Ending Paid Expense Amort. Premium Mar. 1/20 Sept. 1/20 Mar. 1/21 Sept. 1/21 Mar. 1/22 Sept. 1/22 Mar. 1/23 Totals $ 0 $ Record the entries for the issuance of the bond on March 1 th e adiusting entry to a
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