Question

On March 1, 2021, Baddour, Inc., issued 10% bonds, dated January 1, with a face amount of $165 million. The bonds were priced at $143.6 million (plus accrued interest) to yield 12%. Interest is paid semiannually on June 30 and December 31. Baddour's fiscal year ends September 30. Required: 1. to 3. What would be the amount(s) related to the bonds Baddour would report in its balance sheet, income statement and statement of cash flows for the year ended September 30, 2021? (Enter your answers in whole dollars. Negative amounts should be indicated by a minus sign.) Balance sheet: Income statement Statement of cash flows:

Answer 1

Answers (dog) initial balance, Januaryt, 2001 = bords payable - discount -K65,000,000 -(165,000,000 --143,600,00) =165,000,000 -21,400,000 =143,600,000 Tunc 30, 2011, discount amortisation=67X143,600,000)-(564 X165,000 000 5 616000 - 8250000 = 366,000 Sept 30, 21; discount amortization -Col (143,600,000 + 366,000 1x2/6) -(5¥. x 165,000,000 ) x316) = 4318980 - 4125000 = 193980 sept 30, 81, nethands payable = 143,600,000 + 366.000+ 1931980 = 144159980 interest Expense -for fiscal dodi = (640X143,600,000) and +(640x{143,600,000 + 36.000 315)

= 8616000 + 4318980 1934980 statement d cash flows for year ended sept 30, 2001. --> badd our would report the cash inflow of $ 143,600.000 from the sale d the bonds as a cash flow from financing activities in eats statement of cash flows. 143,600.000 The $8,250,000 cash interest paid is a cash out flow from operating activitics because interest is an income statement (perating) itim. Journal entrics.. Date L. Perticehors Debit (62 codilo W cash. Discount on bonds.Payable 21,400.000 To boods payable 2018lat interest Expcase. To Discount on bords payable 366.000 To cash solalar interest expense. To Discount on bonds payable 1931980 to interest payable 41.25,000 165.000.000 8,616,000 8,250,000 4,318,980

baddour, inc. 144159980 4.125.000 Haet bonds payable I interest payable 2. Linterest Expense for fiscal 2021 3 sale of bands. cash interest paid. non mancaneve memor 12934980 143.600.000 $ 250.000