Problem D - Lastimosa CorporationOn March 1. 2017. Lastimosa Corporation sold P400.000 of 12 percent. 5-year bonds at a yield of 10percent compounded semiannually. Interest is payable on March 1and September 1 of each year. Thecorporation is a calendar-year corporation. Bond premiums and discounts are amortized on interest-paying dates and at year-end.Requiredfollowing dates March 1. 2017; September 1, 2017: ana December 31, 2017. Use the effective-interestmethod of amortization. Show supporting calcuations thru an anmortization table.: Prepare the journal entries that are appropriate te account for these bonds on the

Lastimosa Corporation Issuance of Bond March1, 2017 4,00,000…

Required following dates March 1. 2017; September 1, 2017 and December31. 2017. Use the effective-interest method of amortization. Show supporting calculations thru an amortization table. : Prepare the journal entries that are appropriate to account for these bonds on the

Required following dates March 1. 2017; September 1, 2017 and December31. 2017. Use the effective-interest method of amortization. Show supporting calculations thru an amortization table. : Prepare the journal entries that are appropriate to account for these bonds on the

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 5P: Bats Corporation issued 800,000 of 12% face value bonds for 851,705.70. The bonds were dated and...

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Problem D - Lastimosa Corporation
On March 1. 2017. Lastimosa Corporation sold P400.000 of 12 percent. 5-year bonds at a yield of 10
percent compounded semiannually. Interest is payable on March 1and September 1 of each year. The
corporation is a calendar-year corporation. Bond premiums and discounts are amortized on interest-
paying dates and at year-end.
Required
following dates March 1. 2017; September 1, 2017: ana December 31, 2017. Use the effective-interest
method of amortization. Show supporting calcuations thru an anmortization table.
: Prepare the journal entries that are appropriate te account for these bonds on the

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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
Transfer between Categories On December 31, 2018, Leslie Company held an investment in bonds of Kaufmann Company which it categorized as being held to maturity. At that time, the 8%, 100,000 face value bonds had a carrying value of 107,023.56 and were being amortized using the effective interest method based on a market rate of 7%. Interest on these bonds is paid annually each December 31. On December 31, 2019, after recording the interest earned, Leslie decided to reclassify the Kaufmann bonds to its available-for-sale category in anticipation of a major restructuring. At that time, the ending quoted market price for the bonds was 105,000. Required: Prepare the journal entries on December 31, 2019, to record the interest earned and the reclassification.
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