On January 1, 2020, Larkspur Inc. issued $580,000 of 4-year, 4%
bonds to yield a market...
On January 1, 2020, Larkspur Inc. issued $580,000 of 4-year, 4%
bonds to yield a market interest rate of 5%. Interest is paid every
quarter on January 1, April 1, July 1, and October 1. Larkspur has
a calendar year end.
After recording the December 31, 2021 accrual for quarterly
interest, and making the payment on January 1, 2022, all the bonds
were redeemed at 103.
(a)
Use Excel or a financial calculator to determine how much the
company received...
Larkspur Company sells 8% bonds having a maturity value of
$2,000,000 for $1,848,366. The bonds are...
Larkspur Company sells 8% bonds having a maturity value of
$2,000,000 for $1,848,366. The bonds are dated January 1, 2020, and
mature January 1, 2025. Interest is payable annually on January
1.
Determine the effective-interest rate. (Round answer
to 0 decimal places, e.g. 18%.)
The effective-interest rate
Set up a schedule of interest expense and discount amortization
under the effective-interest method. (Round
intermediate calculations to 5 decimal places, e.g. 1.25124 and
final answer to 0 decimal places, e.g. 38,548.)...
On January 1, 2021, Cullumber Satellites issued $1,430,000,
10-year bonds. The bonds pay semi-annual interest on...
On January 1, 2021, Cullumber Satellites issued $1,430,000,
10-year bonds. The bonds pay semi-annual interest on July 1 and
January 1, and Cullumber has a December 31 year end. A partial bond
amortization schedule is presented below:
Semi-Annual
Interest Period
Interest
Payment
Interest
Expense
Amortization
Bond
Amortized Cost
Jan. 1, 2021
$1,328,381
July 1, 2021
$ [1]
$ [2]
$3,593
1,331,974
Jan. 1, 2022
42,900
46,619
3,719
1,335,693
July 1, 2022
42,900
46,749
[3]
1,339,542
Jan. 1, 2023
42,900
46,884...
Cougar Corp. sold 2-year, 5%, $200,000, bonds on January 1, 2020
for $208,000. Interest is paid...
Cougar Corp. sold 2-year, 5%, $200,000, bonds on January 1, 2020
for $208,000. Interest is paid semi-annually on June 30 and
December 31.
2 points
What is the journal entry to record the issuance of the Bond on
1/1/2020?
8 points: Complete the amortization schedule below.
Period
ended
Cash Paid
Interest expense
amortization
Carrying
amount
06/30/2020
12/31/2020
06/30/2021
12/31/2021
$480,000, 9%, 20-year bonds on January 1, 2020, for $439,135.
effective-interest rate of 10% on the...
$480,000, 9%, 20-year bonds on January 1, 2020, for $439,135.
effective-interest rate of 10% on the bonds which payable annually
on January 1. Monty uses the effective-interest method to amortize
bond premium or discount.
A) use the effective-interest method to amortize bond
prem/disc.
record issuance on bond.
Jan 1 2020
cash -
Discount on bonds payable-
bonds payable-
B) Record accrual of interest/ discount amortization
Dec31,2020
Dec 31
Interest expense -
discount on bonds payable -
interest payable -
C)...
On January 1, 2021, Sheridan Satellites issued $1,200,000,
10-year bonds. The bonds pay semi-annual interest on...
On January 1, 2021, Sheridan Satellites issued $1,200,000,
10-year bonds. The bonds pay semi-annual interest on July 1 and
January 1, and Sheridan has a December 31 year end. A partial bond
amortization schedule is presented below:
Semi-Annual
Interest Period
Interest
Payment
Interest
Expense
Amortization
Bond
Amortized Cost
Jan. 1, 2021
$1,114,726
July 1, 2021
$ [1]
$ [2]
$3,015
1,117,741
Jan. 1, 2022
36,000
39,121
3,121
1,120,862
July 1, 2022
36,000
39,230
[3]
1,124,092
Jan. 1, 2023
36,000
39,343...
On January 1, 2020, Culver Company acquires $210,000 of
Spiderman Products, Inc., 9% bonds at a...
On January 1, 2020, Culver Company acquires $210,000 of
Spiderman Products, Inc., 9% bonds at a price of $199,736. Interest
is received on January 1 of each year, and the bonds mature on
January 1, 2023. The investment will provide Culver Company a 11%
yield. The bonds are classified as held-to-maturity.
A) Prepare a 3-year schedule of interest revenue and bond
discount amortization, applying the straight-line method.
B) Prepare a 3-year schedule of interest revenue and bond
discount amortization, applying...
Effective Interest Amortization
On January 1, Eagle, Inc., issued $950,000 of 9%, 20-year bonds for
$1,016,500...
Effective Interest Amortization
On January 1, Eagle, Inc., issued $950,000 of 9%, 20-year bonds for
$1,016,500 yielding an effective interest rate of 8%. Semiannual
interest is payable on June 30 and December 31 each year. The firm
uses the effective interest method to amortize the premium.
Required
a. Prepare an amortization schedule showing the necessary
information for the first two interest periods. Round amounts to
the nearest dollar.
b. Prepare the journal entry for the bond issuance on January
1....
Cheyenne Company sells 8% bonds having a maturity value of
$2,400,000 for $2,218,040. The bonds are...
Cheyenne Company sells 8% bonds having a maturity value of
$2,400,000 for $2,218,040. The bonds are dated January 1, 2020, and
mature January 1, 2025. Interest is payable annually on January
1.
Determine the effective-interest rate. (Round answer
to 0 decimal places, e.g. 18%.)
The effective-interest rate
%
eTextbook and Media
Set up a schedule of interest expense and discount amortization
under the effective-interest method. (Round
intermediate calculations to 5 decimal places, e.g. 1.25124 and
final answer to...
Novak Company sells 8% bonds having a maturity value of
$3,170,000 for $2,929,660. The bonds are...
Novak Company sells 8% bonds having a maturity value of
$3,170,000 for $2,929,660. The bonds are dated January 1, 2020, and
mature January 1, 2025. Interest is payable annually on January
1.
Determine the effective-interest rate. (Round answer
to 0 decimal places, e.g. 18%.)
The effective-interest rate
%
Set up a schedule of interest expense and discount amortization
under the effective-interest method. (Round
intermediate calculations to 5 decimal places, e.g. 1.25124 and
final answer to 0 decimal places,...