Calculate the accrued interest (in $) and the total purchase price (in $) of the bond purchase. (Round your answers to the nearest cent.) Time Coupon Market Accrued Commission Bonds Total Company Since Last Rate Price Interest per Bond Purchased Price Interest Company 1 9.25 102.50 78 days 2$ $5.50 15 $

Calculate the accrued interest (in $) and the total purchase price (in $) of the bond purchase. (Round your answers to the nearest cent.) Time Coupon Market Accrued Commission Bonds Total Company Since Last Rate Price Interest per Bond Purchased Price Interest Company 1 9.25 102.50 78 days 2$ $5.50 15 $

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter14: Long-term Liabilities: Bonds And Notes

Section: Chapter Questions

Problem 6PEA

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The principal of a bond is ________. A. the person who sold the bond for the company B. the person who bought the bond C. the interest rate printed on the front of the bond D. the face amount of the bond that will be paid back at maturity
Use the worksheet to compute the bond issue price if the effective interest rate is 9%. Bond issue price _____
a. Reset the Data Section to its initial values. The price of this bond is 1,407,831. What would it be if there were only 9 or 8 years to maturity? Use the worksheet to compute the bond issue prices and enter them in the spaces provided. Bond issue price (9 years to maturity) __________________ Bond issue price (8 years to maturity) __________________ b. Compare these prices to the bond-carrying values found in the effective interest amortization schedule you originally printed out in requirement 3. Explain the similarity. c. Click the Chart sheet tab. The chart presented shows the price behavior of this bond based on years to maturity. Explain what effect years to maturity has on bond prices. Check your explanation by trying 8% as the effective rate (cell E10) and clicking the Chart sheet tab again. Also try 9%. When the assignment is complete, close the file without saving it again. Worksheet. Modify the BONDS3 worksheet to accommodate bonds with up to 20-year maturity. Use your new model to determine the issue price and amortization schedules of a 2,000,000, 18-year, 10% bond issued to yield 9%. Preview the printout to make sure that the worksheet will print neatly, and then print the worksheet. Save the completed file as BONDST. Hint: Expand both amortization schedules to 20 years. Expand the scratch pad to 20 years. Modify FORMULA1 in cell F17 to include the new ranges. Chart. Using the BONDS3 file, prepare a line chart that plots annual interest expense over the 10-year life of this bond under both the straight-line and effective interest methods. No Chart Data Table is needed. Put A23 to A32 in the Label format and then select A23 to A32, D23 to D32, and B40 to B49 as a collection. Enter all appropriate titles, legends, formats, and so forth. Enter your name somewhere on the chart. Save the file again as BONDS3. Print the chart.
Bats 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
Calculate the Accrued interest in dollars and the total purchase price in dollars of the Bond purchase. Round your answers to the nearest cent.
From page 9-2 of the VLN, how do you determine the annuity cash flow (the bond interest payment) from an annual bond? Group of answer choices A. Bond payable x stated rate B. Bond liability x stated rate C. Bond payable x market rate D. Bond liability x market rate
A bond is issued at a price of 103 and retired early at aprice of 97. Which of the following is true?a. A gain will be reported on the income statement whenthe bond is issued.b. A loss will be reported on the income statement whenthe bond is issued.c. A gain will be reported on the income statement whenthe bond is retired.d. A loss will be reported on the income statement whenthe bond is retired.
Presented below is information taken from a bond investment amortization schedule with related fair values provided. These bonds are classified as available-for-sale. 31.12.14 31.12.15 31.12.16Amortized Cost Tk. 491,150 519,442 550000Fair Value Tk. 497,000 509,000 550000Required:(a) Indicate whether the bonds were purchased at a discount or at a premium.(b) Prepare the adjusting entry to record the bonds at fair value at December 31, 2014. The Fair Value Adjustment account has a debit balance of Tk. 1,000 prior to adjustment.(c) Prepare the adjusting entry to record the bonds at fair value at December 31, 2016
Please advise if the bond interest expense is $29K, $18200 or $21800. Thanks.
Assume bonds payable are amortized using the straight-line amortization method unless stated otherwise. Pricing bonds Bond prices depend on the market rate of interest, stated rate of interest and time. Requirements Compute the price of the following 8% bonds of Country Telecom. a. $100,000 issued at 75.25 $100,000 issued at 94.50 b. $100,000 issued at 103 50 c. $100,000 issued at 94.50 d. $100,000 issued at 103.25 2. Which bond will Country Telecom have to pay the most to retire at maturity? Explain your answer.
Calculate the accrued interest (in $) and the total proceeds (in $) of the bond sale. (Round your answers to the nearest cent.)
Assume bonds payable are amortized using the straight-line amortization method unless stated otherwise. Pricing bonds Bond prices depend on the market rate of interest, stated rate of interest and time. Requirements Compute the price of the following 8% bonds of Country Telecom. $100,000 issued at 75.25 $100,000 issued at 94.50 $100,000 issued at 103 50 $100,000 issued at 94.50 $100,000 issued at 103.25 2. Which bond will Country Telecom have to pay the most to retire at maturity? Explain your answer.