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...
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...
Question 1 (22 marks) Ivanhoe Corporation issued $3.12 million
of 7-year, 3% bonds dated January 1,...
Question 1 Ivanhoe Corporation issued $3.12 million
of 7-year, 3% bonds dated January 1, 2021 for $2,755,244. The
market interest rate when the bonds were issued was 5%. Interest is
payable semi-annually on January 1 and July 1. Ivanhoe has a
December 31 year-end. Were the bonds issued at a premium or a
discount? Why? Prepare an amortization schedule for the
first three interest payments. Prepare the journal entry
to record the first interest payment on July 1, 2021.
Prepare...
P9.3 The following amortization schedule is for
Flagg Ltd.'s investment in Spangler Corp.'s $100,000, five-year
bonds...
P9.3 The following amortization schedule is for
Flagg Ltd.'s investment in Spangler Corp.'s $100,000, five-year
bonds with a 7% interest rate and a 5% yield, which were purchased
on December 31, 2019, for $108,660:
Cash
Received
Interest
Income
Bond Premium
Amortized
Amortized Cost
of Bonds
Dec. 31, 2019
$108,660
Dec. 31, 2020
$7,000
$5,433
$1,567
107,093
Dec. 31, 2021
7,000
5,354
1,646
105,447
Dec. 31, 2022
7,000
5,272
1,728
103,719
Dec. 31, 2023
7,000
5,186
1,814
101,905
Dec. 31, 2024
...
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.
Prepare a bond amortization schedule for the first two years (8
interest periods). (Round answers to 0 decimal places,
e.g. 5,276.)
LARKSPUR INC.
Bond Discount Amortization Schedule
Effective-Interest Method
Semi-Annual Interest
Period
Interest Payment
Interest Expense
Amortization
Bond Amortized...
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....
Crane Corporation wished to raise money for a series of upcoming
projects. On July 1, 2017,...
Crane Corporation wished to raise money for a series of upcoming
projects. On July 1, 2017, the company issued bonds with a face
value of $5,099,000 due in 5 years, paying interest at a face rate
of 8% on January 1 and July 1 each year. The bonds were issued to
yield 6%. Crane used the effective interest method of amortization
for bond discounts or premiums. The company’s year-end was
September 30. Prepare a complete Bond Premium/Discount Amortization
Schedule (i.e....
The following information is taken from Pronghorn Corp.’s
balance sheet at December 31, 2016. Current liabilities...
The following information is taken from Pronghorn Corp.’s
balance sheet at December 31, 2016. Current liabilities Interest
payable $ 92,000 Long-term liabilities Bonds payable (7%, due
January 1, 2027) $4,080,000 Less: Discount on bonds payable 40,800
4,039,200 Interest is payable annually on January 1. The bonds are
callable on any annual interest date. Pronghorn uses straight-line
amortization for any bond premium or discount. From December 31,
2016, the bonds will be outstanding for an additional 10 years (120
months). (a)...
Presented below is a partial amortization schedule for Discount
Pizza.
(1)
(2)
(3)
(4)
(5)
Period...
Presented below is a partial amortization schedule for Discount
Pizza.
(1)
(2)
(3)
(4)
(5)
Period
Cash Paid
for Interest
Interest
Expense
Increase
in
Carrying Value
Carrying
Value
Issue
date
$58,467
1
$2,240
$2,339
$99
58,566
2
2,240
2,343
103
58,669
1. & 2. Record the bond issue and first
interest payment assuming the face value of bonds payable is
$64,000. (If no entry is required for a transaction/event,
select "No...
On December 31,2020,Mobbs Corp. issues 11 percent, 10-year
convertible bonds with a maturity value of $5,500,000....
On December 31,2020,Mobbs Corp. issues 11 percent, 10-year
convertible bonds with a maturity value of $5,500,000. The
semi-annual interest dates are June 30 and December 31. The market
interest rate is 12 percent, and the issue price of the bonds is
93.5636364. Mobbs Corp. amortizes bond premium and discount by the
effective-interest method.Required
Requirement 1. Prepare an effective-interest method
amortization table for the first four semi-annual interest
periods. (Round your answers to the nearest dollar.)
Mobbs Corp.
Amortization Table
A...