Berry Co. issued P800,000 of 12% ace value bonds for P851,706. The onds which were dated and issued n April 1, 2017, are due March 31,
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A: Solution: Under interest method of bond amortization, Discount amortized is difference between cash…
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A: 1.
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A: Amortization of bond premium = Interest payment - Interest expense where, Interest expense =…
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A: Carrying value is present value of future cash flows discount @5%(10/2)
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A: The question is based on the concept of Financial Accounting.
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A: Introduction: A bond is a fixed responsibility issued by corporations or government entities to pay…
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A: A journal entry is used to record day-to-day transactions of the business by debiting and crediting…
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A: You have posted multiple parts, so as per Bartleby policy only the first three parts are answered.…
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A: Issue Price of Bond=Present Value of Maturity amount+Maturity value of Interest payment Present…
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A: Carrying amount of the bond liability on December 31, 2017 = Cash proceeds from bonds issue +…
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A: Issue price of the bonds means the cash received from the issue of the bonds. Issue price of the…
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A: The bonds are issued at discount when market rate is higher than the coupon rate of bonds payable.
Q: Bogart . issued P800,000 of 12% face value bonds for P851,706. The bonds which were dated and issued…
A: Current price of the bond is the present value of all the cash flows payable on the bond discounted…
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A: Bond: A bond is a financial instrument in the which borrower would pay the periodic interest to the…
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A: Solution: Face amount of bond= P1,000,000 Premium on issue of bond = P62,000 Issue price of bond =…
Q: On January 1, 2016, Truffle Corp. issued 9% bonds in the face amount of P 5,000,000, which maature…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
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A: cash payment = 1000000*111.5% + 1000000*15%*2/12 = 1140000 loss = 1200000-1110401= 9599
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A: If the bonds are issued at price less than the face value then it is said to be issued at discount.
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A:
Q: On January 1, 2016, Truffle Corp. issued 9% bonds in the face amount of P 5,000,000, which maature…
A: Interest expense = Issue price of the bonds x yield rate of interest x No. of months in calendar…
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A: Interest expense is the cost of borrowing money that lender charges a borrower.
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Q: Berry Co. issued P800,000 of 12% face value bonds for P851,706. The bonds which were dated and…
A: The question is based on the concept of Financial Accounting.
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A: Concept: The amortization is defined as the accounting techniques that are used to lowering the book…
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A: A BOND IS A DEBT SECURITY WHICH BORROWERS ISSUE BONDS TO RAISE MONEY FROM INVESTORS WILLING TO LEND…
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Q: E10-19 Gridley Ltd. issued £800,000, 11%, 10-year bonds on December 31, 2016, for £730,000. Interest…
A: Working Note: Discount on bonds=Par value-Issue price=800,000-730,000=70,000
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A: As bonds are issued at premium, it means that bonds are sold at the amount that is greater than…
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A: a). Face value of bond = $2,400,000 (24,000 bonds) = $120,000…
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A: Bonds refer to the borrowing security that is issued by the company to raise finds from the market…
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A: Lets understand the basics. There are two method for amortizing bond premium/discount which are, (1)…
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- On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated interest rate of 12% payable semi-annually on July 1 and January 1. The bonds were sold to yield 10%. Assuming the bonds were sold at 107.732, what is the selling price of the bonds? Were they issued at a discount or a premium?Naval Inc. issued $200,000 face value bonds at a discount and received $190,000. At the end of 2018, the balance in the Discount on Bonds Payable account is $5,000. This years balance sheet will show a net liability of ________. A. $200,000 B. $180,000 C. $195,000 D. $205,000Bats Corporation issued 800,000 of 12% face value bonds for 851,705.70. The bonds were dated and issued on April 1, 2019, are due March 31, 2023, and pay interest semiannually on September 30 and March 31. Bats sold the bonds to yield 10%. Required: 1. Prepare a bond interest expense and premium amortization schedule using the straight-line method. 2. Prepare a bond interest expense and premium amortization schedule using the effective interest method. 3. Prepare any adjusting entries for the end of the fiscal year, December 31, 2019, using the: a. straight-line method of amortization b. effective interest method of amortization 4. Assume the company retires the bonds on June 30, 2020, at 103 plus accrued interest. Prepare the journal entries to record the bond retirement using the: a. straight-line method of amortization b. effective interest method of amortization
- Smashing Cantaloupes Inc. issued 5-year bonds with a par value of $35,000 and an 8% semiannual coupon (payable June 30 and December 31) on January 1, 2018, when the market rate of interest was 10%. Were the bonds issued at a discount or premium? Assuming the bonds sold at 92.288, what was the sales price of the bonds?On July 1, Somerset Inc. issued $200,000 of 10%, 10-year bonds when the market rate was 12%. The bonds paid interest semi-annually. Assuming the bonds sold at 58.55, what was the selling price of the bonds? Explain why the cash received from selling this bond is different from the $200,000 face value of the bond.Wilbury Corporation issued 1 million of 13.5% bonds for 985,071.68. The bonds are dated and issued October 1, 2019, are due September 30, 2020, and pay interest semiannually on March 31 and September 30. Assume an effective yield rate of 14%. Required: 1. Prepare a bond interest expense and discount amortization schedule using the straight-line method. 2. Prepare a bond interest expense and discount amortization schedule using the effective interest method. 3. Prepare adjusting entries for the end of the fiscal year December 31, 2019, using the: a. straight-line method of amortization b. effective interest method of amortization 4. If income before interest and income taxes of 30% in 2020 is 500,000, compute net income under each alternative. 5. Assume the company retired the bonds on June 30, 2020, at 98 plus accrued interest. Prepare the journal entries to record the bond retirement using the: a. straight line method of amortization b. effective interest method of amortization 6. Compute the companys times interest earned (pretax operating income divided by interest expense) for 2020 under each alternative.