Answered: when the interest payment date of a…

when the interest payment date of a bond are may 1 and november 1, and a bond is purchased on june 1, the amount of cash paid by the investor would be

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 3MC: The principal of a bond is ________. A. the person who sold the bond for the company B. the person...

See similar textbooks

Related questions

Q: A bond issued by a corporation on May 1, 1999, is scheduled to mature on May 1, 2019. If today is…

A: Details given are : Bond issue date = May 1 , 1999 Bond Maturity date = May 1 , 2019 Today's date =…

Q: Define current liabilities and long-term liabilities. Underwhat circumstances might a 10-year bond…

A: Liabilities are referred to as the obligation of the business towards the creditors for operating…

Q: What is the amount of bond interest expense for the first year?

A: Solution: Bond interest expense for first year = Interest expense for first semiannual period +…

Q: f. Now assume the date is October 25, 2019. Assume further that a 12%,10-year bond was issued on…

A: Bond’s yield is the internal rate of return that an investor may expect from the investment in the…

Q: According to the theory, premium bonds, discount bonds, and face value bonds at the expiry date will…

A: Bonds refer to borrowing security issued by the company to raise funds from the market by making an…

Q: The discount on a bond payable becomesa. additional interest expense in the year the bonds are…

A: Bond payable: It can be defined as a debt taken by the company for a longer period and reflects the…

Q: Required: Determine the price of the bonds at January 1, 2021. (Enter your answer in whole dollars.)…

A: Issuance of bonds is one of the sources of financing, bonds are long-term debt for the company…

Q: A $1,000 bond, with interest at 9 ½% on March 1 and September 1, was purchased on November 23.…

A: Accrued interest: Accrued interest is the outstanding interest expense in the accounting period, as…

Q: Prepare journal entries to record the following transactions involving short-term debt investments.…

A: Journal entry: Journal is the book of original entry whereby all the financial transactions are…

Q: How much is initial valuation of the bonds? How much cash was received upon the sale of the bonds?…

A: Accrued Interest can be defined in simple terms as an interest which has been occurred at a…

Q: Provide the journal entry that Bella will make to record the second bond interest payment on…

A: Meaning of Bonds Bonds are fixed debt instruments where a company issues bonds to the lenders. The…

Q: Bond payable due in two years for which there is an adequate sinking fund. Bond payable due in three…

A: Current liabilities are those liabilities which are to be paid during the current period only and…

Q: Journalize the entries to record (a) the issuance of the bonds, (b) the first interest payment on…

A: Journal entries refers to the official book of a company which is used to record the day to day…

Q: (a) Prepare the jounal entry at the date of the bond purchase. Date Account Debit Credit (b) Prepare…

A: When the Bond Investment is classified as held for maturity it is required to be accounted under the…

Q: in one year, the primary concern

A: Step 1 Before investing in a bond, understand two things about risk: your risk tolerance and the…

Q: Prepare an amortization table for these bonds; use the straight- line method to amortize the…

A: When bonds are issued at rate which is less than the market rate of interest it said as bonds are…

Q: If bonds are issued between interest dates, the entry on the bocC of the issuing corporation could…

A: Interest is calculated on face value of a bond.

Q: Required: 1. Prepare journal entries relating to the bonds payable in 2020 and 2021. Straight line…

A: Bond Issue Bond can be issue either par value ,discount and premium. The purpose of issuing the…

Q: Prepare the necessary journal entries in general journal form on the following. a. August 1, 2021,…

A: As per our protocol we provide solution to the first three sub-parts only but as you have asked…

Q: A bond issued by a corporation on June 15, 2007, is scheduled to mature on June 15, 2017. If today…

A: In this question we need to compute the bond's time to maturity.

Q: When the interest payment dates of a bond are May 1 and November 1, and a bond is purchased on June…

A: Interest is the term which is defined as the monetary charge for borrowing the money usually…

Q: On February 1, 2023, what was the value of a P7,000, bond with 5% compounded semiannually due on…

A: Here,

Q: 1. What are the Harry's cash proceeds from issuance of these bonds, presuming that the selling price…

A: As the bond's quoted rate is less than the market rate the bond will be issued in discount and the…

Q: (includes accrued interest). Give entries through December 1, 2022. Prepare a bond amortization…

A: Bonds are an agreement between an investor and investee.

Q: Journalize the first interest payment and the amortization of the related bond premium. Round to the…

A: Bonds are fixed income instruments that pay fixed interest income at regular intervals. O maturity…

Q: How much is the estimated purchase price of the bonds on January 1, 2021?

A: The purchase price of the bond reflects the relationship between coupon interest rate and market…

Q: A bond issued by Ford on May 15, 1997 is scheduled to mature on May 15, 2097. If today is November…

A: The remaining time until the bond matures or expires is referred to as the time to maturity.

Q: These are government bonds issued with an original maturity of between 2 and 10 years. It gives the…

A: A Bond is a financial instrument issued in the form of Debt which carries a periodical interest…

Q: nds on July n July 1, 2021

A: a. Price of bond = [Coupon payment x PVIFA7%,30] + [Face value x PVIF7%,30] = [700000 x 6% x…

Q: Bonds pay the face value to the investor when they are a. held over 10 years. b. held 20 years.…

A: A bond offering at a premium implies the cost is estimated at a premium or costlier than the bond's…

Q: Instructions: 1. Prepare the journal entry at the date of the bond purchase. 2. Prepare the first 3…

A: Bond :— A bond is loan from an investor to a borrower such as a company or government. It's…

Q: 1. Determine the carrying amount of the bonds payable on December 31, 2021. The interest method of…

A: Interest Method of amortizing Bond Discount Under this method, Bond discount is amortized using the…

Q: Majestic Corporation holds an investment in Cromwell bonds that pays interest eachOctober 31.…

A: Given is: Majestic Corporation holds an investment in Cromwell bonds that pays interest eachOctober…

Q: A bond is issued at a price of 103 and retired early at aprice of 97. Which of the following is…

A: Bond Bonds are basically a debt instrument which consist of a promise to pay back the money with…

Q: Record bond issue record the first semiannual interest payment record the second semiannual…

A: Journal entry is the book of original entry in which all the transactions of the business are…

Q: Prepare (in good form) the Semi Annual journal entry needed to be recorded by DFC for the cash…

A: Bond is borrowing security issued by the company to raise funds from the market by making an…

Q: Required a) Explain, including calculations, how the issue of the bond would be accounted for by…

A: On 1st January 2021 Corgi Ltd. issued bonds of £5 million at par value, the bonds are redeemable on…

Q: What is the typical relationship among interest rates onthree-month Treasury bills, long-term…

A: Treasury bills are governmental securities which are risk-free whether issued for short term or long…

Q: 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July…

A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: Required Prepare journal entries using proper accounting methods for all transactions including the…

A: Journal entries refers to the official book of a company which is used to record the day to day…

Q: A. How much are the proceeds that Shanghai Fashions Company will receive on the issue date of the…

A: A. Time Payments 0.5 325,000*0.03 =9,750 (Semiannual coupon payments) 1 9,750 1.5 9,750…

Q: be an investor's taxable income from the bond over the coming year? The bond will not be sold at the…

A: Taxable income consist of two parts one is capital gains and other is coupon interest payments on…

Q: a. Purchase of bonds on August 1, Year 1. b. Receipt of first semiannual interest payment on…

A: a) Date General Journal Debit Credit 01-Aug Investments-Ant Company Bonds 1,500,000.00…

Q: What is the journal entry to record issuance of the bonds on January 1, 2019? Dr. Cash, P500,000…

A: If the Bonds are issued at less then face value the the bonds are discount bonds.

Q: The discount on bonds payable is charged to interest expense a.Using the effective interest method…

A: Bonds payable is referred as the liability account, which used to contain an owed amount to the…

Q: [The following information applies to the questions displayed below.] Hillside issues $4,000,000 of…

A: "Since you have posted a question with multiple sub parts, we will solve first three sub parts for…

Question

when the interest payment date of a bond are may 1 and november 1, and a bond is purchased on june 1, the amount of cash paid by the investor would be

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Concept of Bond

VIEW

Step 2: Analysis of scenario given

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

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
when the interest payment dates of a bond are may 1 and november 1, and a bond is purchased on june 1, the amount of cash paid by the investor would be
When the interest payment dates of a bond are May 1 and November 1, and a bond is purchased on June 1, the amouby of cash paid by the investor would be
When the interest payment dates of a bond are May 1 and November 1, and a bond is purchased on June 1, the amount of cash paid by the investor would be a. Decreased by accrued interest from June 1 to November 1 b. Increased by accrued interest from June 1 to November 1 c. Increased by accrued interest from May 1 to June 1 d. Decreased by accrued interest from May 1 to June 1
When the interest payment dates of a bond are May 1 and November 1,and a bond issue is sold on June 1, the amount of cash received by theissuer will be: a. increased by accrued interest from June 1 to November 1b. increased by accrued interest from May 1 to June 1c. decreased by accrued interest from June 1 to November 1d. decreased by accrued interest from May 1 to June 1
What is the amount of bond interest expense for the first year?
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
Assuming the investment is appropriately recognized as a financial asset intended to collect contractual cash flows and also to sell the bonds in open market: How much is the interest receivable to be recognized on December 31, 2020?
How do I Prepare a journal entry for a bond to record the installment payment and any interest. with an effective interest rate for the bond is 14% per year? Is this the correct way below? Credit Cash Debit Mortgage payable Debit Interest Payable Credit Cash
When determining the amount of interest to be paid on a bond, which of the following information is not necessary? a. The length of the interest period, annually or semiannually b. The face rate of interest on the bonds c. The face amount of the bonds d. The selling price of the bonds
What is the interest income on the bond investment for the year 2022? What is the carrying amount of the bond investment on December 31, 2022?
Problem is attached* How much interest income should be reported in 2019? On December 31, 2020, the bond investment should be reported at what amount? If bonds are sold on July 1, 2021 for P5,900,000, how much gain or loss on sale should Spark recognize?