Karen Austin Inc. has issued three types of debt on January 1, 2020, the start of the company’s fiscal year. (a)   $10 million, 10-year, 15% unsecured bonds, interest payable quarterly. Bonds were priced to yield 12%. (b)   $25 million par of 10-year, zero-coupon bonds at a price to yield 12% per year. (c)   $20 million, 10-year, 10% mortgage bonds, interest payable annually to yield 12%. Prepare a schedule that identifies the following items for each bond: (1) maturity value, (2) number of interest periods over life of bond, (3) stated rate per each interest period, (4) effective-interest rate per each interest period, (5) payment amount per period, and (6) present value of bonds at date of issue.

Q: On January 1, 2020, MNOCompany issued its 9%, P2 million bonds, which mature on January 1, 2030. The…

A:

Q: Myriad Solutions, Inc. issued 14% bonds, dated January 1, with a face amount of $410 million on…

A: Bonds payable: It is a long term liability to the organization issuing it. It is issued to raise…

Q: Kingbird Inc. issued $2,100,000 of convertible 10-year bonds on july 1,2020. The bonds provide for…

A: a. % of bond converted = $210,000/$2,100,000 = .10 or 10% Period of Amortization = 10 x 12 = 120…

Q: On July 1, 2019, Choir Company issued $700,000 face value of 5%, 20 year bonds. The bonds call for…

A: Journal entries: It is the duty of the accountant to record business economic and non economic…

Q: Myriad Solutions, Inc., issued 10% bonds, dated January 1, with a face amount of $320 million on…

A: Requirement 1:

Q: On January 1, 2020, when the market rate for bonds interest was 12%, Black Corporation issued P10…

A: Amortization of bond: The process of allocation and reduction of the discount or premium on bonds…

Q: On February 1, 2021, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of…

A:

Q: On January 1, 2015, Mac Inc. issued 3,000,000 bonds with a coupon rate of 8% maturing in 4 years.…

A: Issue Price of Bond (Present Value) = PV of Coupon Payments + PV of Redemption Value PV of Coupon…

Q: On January 1, 2016, Pharaoh Company issued 3-year bonds with a face value of P1,200,000 and stated…

A: Bonds: It is also known as a fixed-income security, it is a debt instrument created for the purpose…

Q: At the beginning of 2020. Wallace Corporation issued 10% bonds with a face value of P900,000. These…

A: Interest expense is the outlay incurred by an entity due to borrowing of notes or issue of bonds or…

Q: On January 1, 2020, Garner Hot Rods issued $2,000,000 of 6%, 10-year bonds. Interest is payable…

A: Compute coupon payment for six months period as shown below:

Q: 1. Calculate the issue price of the corporate bonds of Evermaster on May 1, 2022 2. Prepare a…

A: 20 Corporate Bond Face Value of Each Bond  $       1,00,000 Maturity  5 years Coupon Rate (…

Q: On January 1, 2020, Ellison Co. issued eight-year bonds with a face value of $6,000,000 and a stated…

A: A bond is a fixed obligation to pay that is offered to investors by a company or government…

Q: On December 31, 2020, Balbond issued 3,000 of its 15-year 6%, P1,000 face value bonds for…

A: Lets understand the basics. For calculating carrying value of the bond, we will need use effective…

Q: Determine the selling price of the bonds.

A: The selling price of bond is calculated as present value of coupon amount which is based on coupon…

Q: The long-term liability section of Twin Digital Corporation's balance sheet as of December 31, 2020,…

A: Journal Entry:   Journal entry has two effects for every transaction. The journal entry is passed by…

Q: On January 1, 2021, Callahan Auto issued $900,000 of 9%, 10-year bonds. Interest is payable…

A: Semiannual Stated interest rate=Annual rate2=9%2=4.5%

Q: On June 1, 2018, Ken Company sold $200,000 in long-term bonds for $175,520. The bonds have a stated…

A: Amortization of a bond discount refers to the writing off the bond discount over the life of bond.

Q: On January 1, 2021, Sheridan Co. issued ten-year bonds with a face value of $4,500,000 and a stated…

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

Q: Most Solutions, Inc., issued 10% bonds, dated January 1, with a face amount of $640 million on…

A:

Q: Myriad Solutions, Inc., issued 10% bonds, dated January 1, with a face amount of $320 million on…

A: Bond is a financial instrument to raise funds. The company issues bonds to raise an amount of money…

Q: Colwood Candies issued $370,000 of 12%, five-year bonds on January 1, 2020, when the market interest…

A: Amortization schedule is the one which is prepared to record the interest incurred during a period,…

Q: Kingbird Inc. has issued three types of debt on January 1, 2020, the start of the company's fiscal…

A:

Q: On December 31, 2022, Miriam Company issued serial bonds with face value of P4,000,000 and a stated…

A: The issue price of bonds will be equal to the present value of all future cash inflows.   The…

Q: The Bradford Company issued 10% bonds, dated January 1, with a face amount of $80 million on January…

A: Given information Future value= 80,000,000 Number of years= 10 × 2= 20 Rate of interest= 12% ÷ 2=…

Q: The Bradford Company issued 10% bonds, dated January 1, with a face amount of $94 million on January…

A: 1. Given, Face amount = $94000000 n = 10 x 2 = 20 i = 10%/2 = 5% Market yield = 12%/2 = 6% Cash…

Q: On January 1, 2021, Cheyenne Co. issued ten-year bonds with a face value of $4,700,000 and a stated…

A: Calculate the issue price of the bonds.

Q: On December 31, 2020, Balbond issued 3,000 of its 5-year 6%, P1,000 face value bonds at par.…

A: The effective rate of interest paid is the effective interest rate. The target or required interest…

Q: Please I want answer for this question of Multiple Choice

A: Bond issued on January 1, 2012 for 410,000 Face value is 450,000

Q: Evermaster Corporation issued €350,000 of 10% term bonds on January 1, 2015, due on January 1, 2020,…

A: a. maturity value of bond = 350,000 pv of 350,000 discounted at rate 12% for 5 years PV =…

Q: Karen Austin Inc. has issued three types of debt on January 1, 2020, the start of the company's…

A: Step 1: a. Prepare the schedule for unsecured bonds as follows: Here, the PVIFA of 23.1148 has been…

Q: On January 1, 2021, a company issued serial bonds with a face value of 3,000,000 and a stated rate…

A: Carrying value of the bonds = Present value of principal + Present value of interest payments where,…

Q: On January 1, 2018, Methodical Manufacturing issued 100 bonds, each with a face value of $1,000, a…

A: Journal entry is a primary entry that records the financial transactions initially.

Q: Myriad Solutions, Inc. issued 10% bonds, dated January 1, with a face amount of $320 million on…

A: 1.Net amount of liability reported in balance sheet of December 31,2021:

Q: On January 1, 2020, MMM Inc. issues $100,000 face value, 8% semiannual coupon bonds maturing in 10…

A: Semiannual interest payment = face value of bonds x rate of interest x 6/12 = $100,000 x 8% x 6/12 =…

Q: Pronghorn Inc. has issued three types of debt on January 1, 2020, the start of the company’s fiscal…

A: Bonds payable: It is a long term liability to the organization issuing it. It is issued to raise…

Q: Agee Technology, Inc., issued 9% bonds, dated January 1, with a face amount of $400 million on July…

A: Working notes:

Q: Kingbird Inc. issued $2,100,000 of convertible 10- year bonds on july 1,2020. The bonds provide for…

A: In journal transactions are recorded chronologically and information regarded financial transaction…

Q: On February 1, 2021, Cromley Motor Products issued 8% bonds, dated February 1, with a face amount of…

A: Given that: Face value of bonds = $75 million Coupon rate = 8%

Q: On July 1, 2020, Most Inc. issued $1,000,000 face value, 8% semiannual coupon bonds maturing in 10…

A: Semiannual interest payment = face value of bonds x rate of interest x 6/12 = $1,000,000 x 8% x 6/12…

Q: What amount of cash did ABC Company receive on January 1, 2020?

A: Cash received from the bonds is the amount of cash which a company receives from the issuance of the…

Q: On January 1, 2017, Satin Corp. issued eight-year, 6% bonds with a face value of $500,000, with…

A: Bonds refer to a financial security which is used by the borrowers to source required funds from a…

Q: On January 1, 2018, Ellison Co. issued 8-year bonds with a face value of $300,000 and a stated…

A: The value of bonds are determined and based on the market rate of interest. Sometimes, the…

Q: On the first day of 2021, Blackberry issues $730 million of its 10% bonds for $666 million. The…

A: Part 1   Date  Particulars Amt(Dr)($) Amt(Cr)($)   Working    30-Jun Interest Expense A/c  Dr…

Q: 5. On January 1, 2020, Monterey Company issues 100 million unsecured bonds at an issue price 95…

A: Amortized Cost of Bond - It is the cost which accumulated portion of bond in which principal on the…

Q: On January 1, 2018, Wawatosa Inc. issued 10-year bonds with a face value of $200,000 and a stated…

A: When the interest rate on the bond is higher than the market interest rate, they are always issued…

Q: Prepare the journal entries to record the conversion, amortization, and interest in connection with…

A:

Q: On January 1, 2020, Swity Company sold 11% bonds having a maturity value of $700,000 for $726,535,…

A: Interest Expense = Opening Carrying Amount * 10% Premium Amortized = Cash Paid - Interest Expense

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.