Answered: 17,062 on Jan 1. Market rate is 6%.…

17,062 on Jan 1. Market rate is 6%. Prepare journal entries for the following. a. Sale on Jan 1 b. July1 entry Jan 1 entry. Yr

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter22: Corporations: Bonds

Section: Chapter Questions

Problem 2CE

See similar textbooks

Related questions

Q: On July 1, Year 1, Danzer Industries Inc. issued $48,800,000 of 10-year, 9% bonds at a market…

A: Bonds defined as the units of the corporate debt issued through the companies as well as securitized…

Q: On July 1, Year 1, Khatri Industries Inc. issued $18,000,000 of 10-year, 5% bonds at a market…

A: Coupon rate = 5%/2 Coupon rate = 2.5% Market rate = 6%/2 Market rate = 3% Number of periods =…

Q: Favreau Corporation wholesales repair products to equipment manufacturers. On April 1, Year 1,…

A: Market / Effective rate : 11% p.a. or 5.5% semi-annually Term of bond = 7 Years Semi-annual interest…

Q: On January 1, 20x1, Pitchfork Company issued a $750,000, 8%, 5-year bond for $860,401 and incurred…

A: GIVEN On January 1, 20x1, Pitchfork Company issued a $750,000, 8%, 5-year bond for $860,401 and…

Q: On January 1, 20x1, Dagul Co. acquired 10%, ₱4,000,000 bonds for ₱3,807,853. The principal is due on…

A: Amortization of bonds: When bonds are purchased at more or less than the face value, the difference…

Q: On January 1, the first day of its fiscal year, Ebert Company issued $35,000,000 of 10-year, 6%…

A: A.1Journalize sale of bonds.

Q: HİLİ Corporation had the following bond issue: Date of issue/sale: May 1, 20-A Principal: $500,000…

A: As posted multiple sub parts we are answering only first three sub parts kindly repost the…

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, Year 1, Campbell Inc. issued…

A: 1. Prepare the journal entry for cash to proceed from the issuance of the bonds on July 1, 20Y1.

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, Year 1, Campbell Inc. issued…

A: Hi Student Since there are multiple subparts, we will answer only first three subparts. If you want…

Q: Assume that the bonds were classified as debt investments at fair value through profit or loss.…

A: “Since you have posted a question with many sub-parts, we will solve three sub-parts for you. To get…

Q: On July 1, 20x7, Axe Co. received P103,288 for P100,000 face amount, 12% bonds, a price that yields…

A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds.

Q: On March 1, Sullivan Inc. issued $700,000 of 10-year, 11% bonds at an effective interest rate of…

A: Bonds are considered a financial instrument used to raise finance for the organization. It is also…

Q: On January 1, a company issues bonds dated January 1 with a par value of $200,000. The bonds mature…

A: Bond's are issued by companies to raise money from the market instead of taking loan from the banks.…

Q: On January 1, Vega Company purchased as an investment a $1,000, 6% bond for $1,000. The bond pays…

A: Bond is an instrument issued by corporates to public which comes with fixed interest rate. A bond…

Q: On January 1, Year 1, Grow Company purchased P 1,000,000, 12% bonds of Glow Company for P 1,063,394,…

Q: Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley…

A: Number of half years=Number of years×2=5×2=10 half-years

Q: Foren Corporation had the following transactions pertaining to debt investments. Jan 1: Purchased 50…

A: Bonds are the form of investments or loans given by the company. Interest is received or paid on…

Q: On September 30, Jose’s Jalapenos Inc., issued $1,000,000 of 10-year 9% bonds sated September 30,…

A: Journal entries are prepared to record the financial and non financial transactions of the business.

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $60,400,000 of…

A: Journal entries are prepared to record the financial and non-financial transactions of the business…

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $30,000,000 of…

A: On 01.07.20Y1, Campbell Inc. issued $30000000 of 10-year, 10% bonds Received cash = $31951110…

Q: Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley…

A: Solution to a. & b. are as follows:

Q: On July 1, 20Y1, Danzer Industries Inc. issued $50,000,000 of 10-year, 8% bonds at a market…

A: Definition:

Q: On May 1, Cedar Inc. purchases $100,000 of 10-year, Madison Corporation 6% bonds dated March 1 at…

A: Semi annual interest is payable on Sept 1 and hence also on March 1. For Interest Receipt entry, we…

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $30,000,000 of…

A: The Net Present Value(NPV) is the difference between the present value of cash inflow and the…

Q: On July 1, 20Y1, Danzer Industries Inc. issued $50,000,000 of 10-year, 8% bonds at a market…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: On March 1, Year 1, Exxon Corporation issued $950,000 face value bonds at 103, for 10 years at 6%…

A: A journal entry is a form of accounting entry that is used to report a business transaction in a…

Q: Brubeck Co. issued $10,000,000 of 30-year, 8% bonds on May 1 of the current year, with interest…

A: Bonds are instrument issued by company acknowledging the debt raised by company . It is a liability…

Q: Keaubie Co. issued $400,000, 6.75% 15-year bonds payable at a price of 100 (face value), on Jan.…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $14,000,000 of…

A: Journal entries are prepared to record the financial and non financial transactions of the business…

Q: Salt Foods purchases forty $1,000, 7%, 10-year bonds issued by Pretzelmania, Inc., for $37,282 on…

A: Cash received = Face value of Investment x rate of interest x no. of months /12 = $(1000*40)*7%*6/12…

Q: On December 31, 20X1, Sunset Company issues $2,000,000 face value, 5%, 5-year bonds. Interest is…

A: Total par value of Common Stock = No. of common stock converted x Par value per share = 10000 shares…

Q: a. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording…

A: Introduction: Bonds: Bonds are debt instrument issued by the company or other legal bodies to…

Q: On January 1, the first day of the fiscal year, a company issues a $700,000, 7%, 10-year bond that…

A: Formula: Interest amount = Bond amount x Time period x Interest rate

Q: n July 1, Year 1, Danzer Industries Inc. issued $40,000,000 of 10-year, 7% bonds at a market…

A: The bonds are issued at price less than the face value of the bonds therefore the bonds are issued…

Q: On January 1, 2012 Zesto Company received $1,032,880 for $1,000,000 face amount, 12% bonds, a price…

A: Semiannual interest payment = face value of bonds x interest rate x 6/12 = 1000000*12%*6/12 = $60000

Q: A company issues $50,000 of 4% bonds, due in 5 years, with interest payable semiannually. Assuming a…

A: Date (A) Or Sr. n Interest payment (B) 2% *face value Interest expenses (C) 1.5% *previous book…

Q: Shunda Corporation wholesales parts to appliance manufacturers. On January 1, Shunda issued…

A: Date Account title and explanation Debit Credit Jan. 1 Cash $ 32,433,150 Premium on…

Q: On February 1, Hansen Company purchased $84,000 of 5%, 10-year Knight Company bonds at their face…

A: Accrued interest=Face value*coupon rate*n/12

Q: This is all the information I was given for the assignment. I'm expected to complete journal entries…

A: Required journal entries: Note: Face value per bond is assumed $100, so number of bonds issued is…

Q: Lahey Corporation retires its $800,000 face value bonds at 105 on January 1, following the payment…

A: 1. Redemption of Bonds - In the current case, the company holds bonds with a face value of $100 of…

Q: On May 1, Cedar Inc. purchases $150,000 of 10-year, Knox Corporation 8% bonds dated March 1 at 100…

A: Accrued interest = Face value of bonds x rate of interest x no. of months/12 = 150000*8%*6/12 =…

Q: Instructions On January 1, the first day of the fiscal year, a company issues a S300.000, 9%,…

A: Bonds payable = $ 300000 Semi - annual Interest = 300000 * 9% *1/2 = $ 13500

Q: Luke Corp. issued $2,000,000 of 20-year, 9% callable bonds on July 1, Year 1, with interest payable…

A: From July 1 to December 31 = 6 months Interest expense has been accrued for 6 months in the month of…

Q: During two consecutive years, Antlers Company, Inc., completed the following transactions: Year 1…

A: Bonds: Bonds are the long-term promissory notes that are represented by a company while borrowing…

Q: Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley…

A: Premium on bonds to be amortized = Cash received – Face value of bond…

Q: On February 1, Hansen Company purchased $120,000 of 5%, 20-year Knight Company bonds at their face…

A: Calculate the amount of interest received on $120,000 from February 1 to July 1 (5 months).

Q: Shunda Corporation wholesales parts to appliance manufacturers. On January 1, Year 1,Shunda…

Q: Grocery Corporation received $316,189 for 9.00 percent bonds issued on January 1, 2021, at a market…

A: The answer of the above question is in the Next Step

Question

Rolstone Corp issued $200,000, 8% debenture, 5 Yr bonds on Jan. 1, Interest payment dates are Jan 1 and July 1. The bonds are sold for 217,062 on Jan 1. Market rate is 6%. Prepare journal entries for the following.

a. Sale on Jan 1

b. July1 entry Jan 1 entry. Yr 2

c. Oct 1 entry Yr 1 - End of Fiscal Year July 1 entry. Yr 2. Please answer compelete

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Step 5

Step 6

Step by step

Solved in 6 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, accounting and related others by exploring similar questions and additional content below.

Similar questions

Whirlie Inc. issued $300,000 face value, 10% paid annually, 10-year bonds for $319,251 when the market of interest was 9%. The company uses the effective-interest method of amortization. At the end of the year, the company will record ________. A. a credit to cash for $28,733 B. a debit to interest expense for $31,267 C. a debit to Discount on Bonds Payable for $1,267 D. a debit to Premium on Bonds Payable for $1.267
On April 1 a company sells a 5-year, $60,000 bond with a 7% stated interest rate. The market interest on that day was also 7%. If interest is paid quarterly, the company makes interest payments of ________. A. $1,050 B. $3,150 C. $4,200 D. $5,250
Oak Branch Inc. issued $700,000 of 5%, 10-year bonds when the market rate was 4%. They received $757,243. Interest was paid semi-annually. Prepare an amortization table for the first three years of the bonds.
Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018, and received $540,000. Interest is payable semi-annually. The premium is amortized using the straight-line method. Prepare journal entries for the following transactions. A. July 1, 2018: entry to record issuing the bonds B. Dec. 31, 2018: entry to record payment of interest to bondholders C. Dec. 31, 2018: entry to record amortization of premium
On October 1 a company sells a 3-year, $2,500,000 bond with an 8% stated interest rate. Interest is paid quarterly and the bond is sold at 89.35. On October 1 the company would collect ________. A. $200,000 B. $558,438 C. $2,233,750 D. $6,701,250
Volunteer Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $540,000. Interest is payable annually. The premium is amortized using the straightline method. Prepare journal entries for the following transactions. A. July 1, 2018: entry to record issuing the bonds B. June 30, 2019: entry to record payment of interest to bondholders C. June 30, 2019: entry to record amortization of premium D. June 30, 2020: entry to record payment of interest to bondholders E. June 30, 2020: entry to record amortization of premium
Haiku Inc. issued $600,000 of 10-year bonds with a stated rate of 11% when the market rate was 12%. The bonds pay interest semi-annually. Prepare the first three years of an amortization schedule. Assume that the bonds were issued for $565,710.
A company issued $100,000, 5-year bonds, receiving $97,000. What is the balance sheet presentation immediately after the sale?
On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest payments are paid annually, each interest payment will be ________. A. $120,000 B. $60,000 C. $7,500 D. $15,000
Waldron Inc. issued $400,000 bonds with a stated rate of 7% when the market rate was 5%. They are 3-year bonds with interest to be paid annually. Prepare a table to amortize the premium of the bonds. Assume that the bonds were issued for $421,844.
Below is select information from two, independent companies. Additional information includes: On January 1, Company A issued a 5-year $1,500,000 bond with at 6% stated rate. Interest is paid semiannually and the bond was sold at 105.5055 to yield a market rate of 4.75%. On January 1, Company B sold $1,500,000 of common stock and paid dividends of $75,000. A. Prepare an income statement for each company (ignore taxes) B. Explain why the net income amounts are different, paying particular attention to the operational performance and financing performance of each company. (Hint: it may be helpful for you to create an amortization table).
Medhurst Corporation issued $90,000 in bonds for $87,000. The bonds had a stated rate of 8% and pay interest quarterly. What is the journal entry to record the first interest payment?