On January 1, 2019, Tower company issues $15,000 in bonds for $14,700. They were 6 year...
On January 1, 2019, Tower company issues $15,000 in bonds for $14,700. They were 6 year bonds with a coupon rate of 9% and pay semiannual interest. The straight-line method is used to amortize the bond discount. On June 30, 2019 when the first payment is made, how much interest Expense will be recorded?
Homework Answers
Interest expense = $700
Working
| Bond issue price | $ 14,700 |
| Face value | $ 15,000 |
| Discount on bonds payable | $ 300 |
| Number of Interest payments (6 years x 2) | 12 |
| Discount/ premium to be amortized per Half year | $ 25 |
| Cash Interest on bond (15000 x 4.5%) | $ 675 |
| Interest expense to be recorded (675+25) | $ 700 |
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On January 1, 2019, Tower company issues $15,000 in bonds for
$14,700. They were 6 year...
On January 1, 2019, Tower company issues $15,000 in bonds for $14,700. They were 6 year bonds with a coupon rate of 9% a...
On January 1, 2019, Tower company issues $15,000 in bonds for $14,700. They were 6 year bonds with a coupon rate of 9% and pay semiannual interest. The straight-line method is used to amortize the bond discount. On June 30, 2019 when the first payment is made, how much interest Expense will be recorded?
3) On January 1, 2019, Booth Sales issues $10,000 in bonds for $10.900. These are 5-year...
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3) On January 1, 2019, Booth Sales issues $30,000 in bonds for $32,000. These are 5-year...
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Hillside issues $2,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest semiannually on...
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3) On January 1, 2019, Booth Sales issues $30,000 in bonds for $32,000. These are 5-year bonds with a stated rate of 4%, and pay semiannual interest. Booth Sales uses the straight-line method to amortize bond premium. 10 points A) Prepare the journal entry for the issuance of the bonds on January 1, 2019 B) Prepare the journal entry for the first interest payment on June 30, 2019.
Hillside issues $2,000,000 of 6%, 15-year bonds dated January 1,
2019, that pay interest semiannually on June 30 and December 31.
The bonds are issued at a price of $1,728,224.
Required:
1. Prepare the January 1 journal entry to record
the bonds’ issuance.
2(a) For each semiannual period, complete the
table below to calculate the cash payment.
2(b) For each semiannual period, complete the
table below to calculate the straight-line discount
amortization.
2(c) For each semiannual period, complete the
table...
On January 1, 2015, Carter Sales issued $15,000 in bonds for
$15,800. They were 8-year bonds with a stated rate of 9%, and pay
semiannual interest. Carter Sales uses the straight-line method to
amortize the Bond Premium. Immediately after the issue of the
bonds, the ledger balances appeared as follows:
After the first interest payment on June 30, 2015, what will be the
balance in the Premium Account?
debit of $900
credit of $625
credit of $750
debit of $50
14. On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9.400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. On June 30, 2014, when Mahoney makes the first payment to bondholders, how much will they report as interest expense? A) $200 B) $260 C) $60 D) $400
Hillside issues $1800,000 of 7% 15 -year bonds dated January 1, 2019. that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $1,555,401 Required: 1. Prepare the January 1journal entry to record the bonds issuance 2a) For each semiannual period, complete the table below to calculate the cash payment 2b) For each semiannual period, complete the table below to calculate the straight-line discount amortization 2) For each semiannual period, complete the table...
Hillside issues $2,900,000 of 9%, 15 year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31 The bonds are issued at a price of $3,549,590 Required: 1. Prepare the January 1 journal entry to record the bonds' issuance. 2a) For each semiannual period, complete the table below to calculate the cash payment 2/b) For each semiannual period, complete the table below to calculate the straight-line premium amortization 21c) For each semiannual period, complete the...
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