Dixon Corp issued 5,000, 9%, 5-year, P1,000 bonds dated January 1, 2020, at P100 1. Prepare the journal entry to record the sale of these bonds on January 1, 2020, 2. Prepare the adjusting journal entry on December 31, 2020, to record interest expense. 3. Prepare the journal entry on January 1, 2021, to record interest paid.
Q: Presented below are two independent situations. (a) Novak Co. sold $2,080,000 of 12%, 10-year bonds…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: On January 1, 2023, Jones Corporation issued $2.982.000, 9%, 5-year bonds with interest payable on…
A: Interest expense on bonds is calculated at the market rate of interest on the issue value of the…
Q: Chowan Corporation issued $198,000 of 8% bonds dated January 1, 2019, for $191,470.07 on January 1,…
A: Discount on bonds payable is first calculated which is the difference of Bonds par value and the…
Q: Consider the following independent situations: a. On March 1, 2020, Heide Co. issued at 103 plus…
A: Step 1: a. Compute the net amount of cash received as follows:
Q: On January 1, 2020, CAB Co. issued 9% bonds in the amount of P2,500,000, which mature on January 1,…
A: Interest method of amortization: This is a method useful for bonds which are sold at a discount. The…
Q: Kevin Inc. issues P 10,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2020. Interest is paid…
A: given that : Kevin Inc. issues P 10,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2020. The…
Q: Rombus corp issued P600,000, 9%, 20-year bonds on January 1, 2020, at P103. Interest is payable…
A: Each transactions needs to be recorded in the books of accounts. Journal entries are basic…
Q: On January 1, 2018, HI company purchased P1,000,000, 12% bonds for P1,063,394, a price that yields…
A: 12% bonds[Financial Asset @FVTPL]…
Q: Nixon Company reported 10% bonds payable with carrying amount of P5,700,000 on January 1, 2020. The…
A: Given information, 10 per cent interest on bonds payable Face amount= P6,000,000. Yield =12%
Q: On October 1, 2020 Sheffield Corp. issued 6%, 10-year bonds with a face value of $8010000 at 104.…
A: Formula: Premium on bonds payable = Cash received - Face value of bond
Q: Simko Company issued $670,000, 10-year, 4 percent bonds on January 1, 2021. The bonds were issued…
A: When, the debentures are issued at less than par value, it is has been issued at discount. The…
Q: On October 1, 2020 Concord Corporation issued 5%, 10-year bonds with a face value of $7930000 at…
A: On 01.10.2020, Concord corporation issued 10 year bonds with face value = $7930000 Issued price per…
Q: On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including…
A: Statement of financial position includes: Assets account Liabilities account Shareholder's account…
Q: Medow corporation issued 3000 7%, 5 year, P1,000 bonds on January 1 2022 at face value. Inter paid…
A: The procedure of entering commercial transactions for the first time in the books of accounts is…
Q: n Jan 1, 2020, Liezel Company issued 10% bonds in the face amount of P5,000,000 that mature on Jan…
A: Solution Given Face value 5000000 Issue price 4580000 Coupon rate 10%…
Q: On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including…
A: SOLUTION- EXPLANATION- CASH FLOW 9% TABLE VALUE AMOUNT PRESENT VALUE PAR MATURITY VALUE…
Q: Nabil Company issued $1,500,000 of bonds on January 1, 2020. Instructions Prepare the journal…
A: The word redemption seems to have various purposes in the financial and business world, depending on…
Q: pare a schedule of interest expense and bond amortization for 2020–2022.
A: Amortization of bonds refers to the process in which the carrying value of the bond is adjusted with…
Q: On October 1, 2020 Sheffield Corp. issued 6%, 10-year bonds with a face value of $8010000 at 104.…
A: The bonds payable can be issued at discount or premium depending on the market rate of bonds…
Q: On January 2, 2020, Lucan Company issued 9% bonds in the amount of P10,000,000 which mature on…
A: Discount on bonds payable = Par value of bonds - Issue price of bonds Interest expense = Issue price…
Q: n January 1, 2020, JWS Corporation issued $600,000 of 7% bonds, due in 10 years. The bonds were…
A: Solution Working note Coupon amount =600000*7% / 2…
Q: Sheffield Corp. issued 2,100, 6%, 5-year, $1,000 bonds dated January 1, 2019, at 100. Interest is…
A: Bonds payable are one of the sources of finance and are shown as liability. If the interest rate is…
Q: On August 31, 2021, DASHER Company issued at 104 plus accrued interest, three thousand 10% bonds…
A: Hi since you have posted a question with multiple subparts we are solving the 1st 3 subparts for…
Q: On January 1, 2020, Wolf Company issued 10% bonds in the face amount of P5,000,000, which mature on…
A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds.
Q: Dixon Corp issued 5,000, 9%, 5-year, P1,000 bonds dated January 1, 2020, at P100 1. Prepare the…
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…
Q: On June 30, 2021, Arlington Company issued $2,100,000 of 10-year, 3% bonds, dated June 30, for…
A: The bonds are the financial instruments that are used to raise money from the market.
Q: On May 1, 2021, Ligertwood Co. issued P5,000,000, 10%, three-year bonds to yield 8%. The bonds pay…
A: Bond is a debt security which carries a fixed interest rate. The fixed interest rate is known as…
Q: Potter Corporation issued $500,000 of 5%, 12-year bonds payable on March 31, 2019. The market…
A: Answer 1 Face value of the bond is $5,00,000 however same has been issued at discount. If coupon…
Q: On July 1,2020, Conair Company paid P1,198,000 for 10% bonds with a face mount of PI000000 to beheld…
A: Interest Expense = 1,198,000 x 8% x 612 = 47,920 Interest Payment = 1,000,000 x 10% x 612 = 50,00
Q: On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including…
A: Solution: Computation of bond fair value Table values are based on: n= 2 i= 9.00%…
Q: Lasa Corporation issued 5,000, 9%, 5-year, RM1,000 bonds dated January 1, 2020, at 100 (a) Prepare…
A: Journal entries are accounting transactions used to record various accounting transactions in the…
Q: On March 1, 2020, WHITE Corporation purchased bonds with face amount of P5,000,000. The entity paid…
A: When the objective of the entity is not to hold the financial asset till the maturity and the…
Q: On March 1, 2021, Brown-Ferring Corporation issued $100 million of 12% bonds, dated January 1, 2021,…
A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…
Q: Xonic Corporation issued $8 million of 20-year, 8 percent bonds on April 1, 2021, at 102. Interest…
A: a) Date Account titles & explanation Debit Credit Apr 1, 2021 Cash (8,000,000 *102%)…
Q: On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including…
A: Solution: Computation of bond fair value Table values are based on: n= 2 i= 9.00%…
Q: On October 1, 2020 Waterway Industries issued 6%, 10-year bonds with a face value of $8150000 at…
A: Bond is a fixed income instrument which shows a loan made by investor to borrower.
Q: On August 1, 2021, Space Company issued at 97 plus accrued interest, 2,500 of its 12%, P1,000 bonds.…
A: Formula: Cash received on the issue of bonds= Face value of bond x Issue rate of bonds.
Q: Presented below are two independent situations. (a) Bramble Co. sold $1,930,000 of 12%, 10-year…
A: When bonds are issued at a price more than face value, then it means they are issued at a premium.
Q: , Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including broker's commission of…
A: Alaska Corporation purchased P1,000,000 bonds for P1,051,510
Q: On July 1, 2019, Matalik Company issued 5,000 of the P1,000 face value, 8% bonds for P4,615,000 to…
A: Since effective interest rate method is being used. As per effective interest rate method the…
Q: On March 1, 2020, WHITE Corporation purchased bonds with face amount of P5,000,000. The entity paid…
A: Coupon Interest on the bonds: White Corporation purchased the bonds on 1st March 2020 and held the…
Q: On January 1, 2021, for $18 million, Monument Company purchased 10 year, 10% bonds, dated January 1,…
A: Semiannually interest receipt = Face value of bonds x rate of interest x 6/12 months = $20,000,000 x…
Q: (a) Novak Co. sold $2,080,000 of 12%, 10-year bonds at 105 on January 1, 2020. The bonds were dated…
A: Bond discount is the amount by which the selling price (or issue price or market price) of the bond…
Q: Foreman Corporation issued P800, 000 of 10% 20 year bonds on January 1, 2019, at P102. Interest is…
A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…
Q: On January 1, 2018, HI company purchased P1,000,000, 12% bonds for P1,063,394, a price that yields…
A: Lets understand the basics. When debt investment purchased and designated at FVTPL then interest…
Q: Interlink Company was authorized bonds with face amount of P8,000,00 January 1, 2020, and interest…
A: Journal entry is the practice of recording commercial transactions for the first time in the books…
Q: On August 31, 2020, Cebu Pacific Co. issued a 3,000, P1,000, 10%, 5 year bonds at 110 including…
A: Solution- Given-On August 31,2020 ,3000 P1000 10%Year bond dated january 1,2020 issuedat P110…
Q: (a)Prepare the journal entry to record the sale of these bonds on January 1, 2022. (b)Prepare the…
A:
Q: Presented below are two independent situations. (a) Oriole Co. sold $1,840,000 of 12%, 10-year bonds…
A:
Step by step
Solved in 2 steps with 1 images
- 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 amortizationWilbury 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.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
- 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 premiumDixon Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $480,000. Interest is payable annually. The discount 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. June 30, 2019: entry to record payment of interest to bondholders C. June 30, 2019: entry to record amortization of discount D. June 30, 2020: entry to record payment of interest to bondholders E. June 30, 2020: entry to record amortization of discountEdward Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $480,000. Interest is payable semiannually. The discount 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 discount
- 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. $205,000Refer to the information in RE13-5. Assume that on December 31, 2019, the investment in Smith Corporation bonds has a market value of 12,500. Prepare the year-end journal entry to record the unrealized gain or loss.