Bonds Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond. Straight line amortization bond Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment. To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

Question

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Answer 1

Question

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

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Answer 2

Question

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

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Answer 3

Question

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

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Answer 4

Question

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

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Answer 5

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

Answer 6

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

Answer 7

Chapter 10, Problem 10.20E

(a)

To determine

Bonds

Bonds are a kind of interest bearing notes payable, usually issued by companies, universities and governmental organizations. It is a debt instrument used for the purpose of raising fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If selling price of the bond is lesser than the face value, it is known as discount on bond. If selling price of the bond is greater than the face value, it is known as premium on bond.

Straight line amortization bond

Straight line method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the same amount of interest expense in each period of interest payment.

To prepare: The journal entry to record issue of bonds for “A” Company on Jan 1, 2019.

Answer 8

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

Answer 9

(b)

To determine

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

Answer 10

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

Answer 11

(c)

To determine

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

Answer 12

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

Answer 13

(d)

To determine

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

Answer 14

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Answer 15

Expert Solution & Answer

Answer 16

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Answer 17

Ch. 10 - Prob. 1Q Ch. 10 - Prob. 2Q Ch. 10 - Prob. 3Q Ch. 10 - Prob. 4Q Ch. 10 - Prob. 5Q Ch. 10 - 6 What are long-term liabilities? Give three...Ch. 10 - Prob. 7Q Ch. 10 - Prob. 8Q Ch. 10 - Prob. 9Q Ch. 10 - Prob. 10Q

To prepare: The adjustment entry to record accrual of interest and bonds premium amortization for “A” Company on Dec 31, 2019.

To prepare: The journal entry to record the payment of accrued interest for “A” Company on Jan 1, 2020.

To prepare: The journal entry to record redemption of bonds at the time of maturity for the “A” Company on Jan 1, 2039.

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