Homework Answers
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Option C is the answer Discount amortization = 500,000*6%*4/12*1/2 = 5,000 Carrying value = Bond value -Discount amortization = 500,000 - 5,000 = 495,000 |
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bearing note with a maturity value of $500,000 and a discount rate of 6%. Assuming straight-line...
On June 1, 2018, Dirty Harry Co. borrowed cash by issuing a 6-month noninterest-bearing note with...
On June 1, 2018, Dirty Harry Co. borrowed cash by issuing a 6-month noninterest-bearing note with a maturity value of $440,000 and a discount rate of 6%. Assuming straight-line amortization of the discount, what is the carrying value of the note as of September 30, 2018? (Round all calculations to the nearest whole dollar amount.) Multiple Choice 0 $426,800 O $418,000 0 $462.000 0 $435,600
Analyzing Interest-Bearing and Noninterest-Bearing Notes Consider the following three separate scenarios for a one-year, $300,000 note...
Analyzing Interest-Bearing and Noninterest-Bearing Notes Consider the following three separate scenarios for a one-year, $300,000 note payable issued on September 1, 2020. Complete the table, using the straight-line method to amortize any discount on note payable. Note: Round your answers to the nearest whole dollar. $300,000 Note payable $300,000 Note payable 12% Interest due at maturity 10% interest due at maturity 12% market rate 10% market rate Borrower's FYE*: Dec. 31 Borrower's FYE: Nov. 30 $300,000 Note payable Noninterest-bearing 12%...
Exercise 10-2 Straight-Line: Amortization of bond discount LO P2 Tano issues bonds with a par value...
Exercise 10-2 Straight-Line: Amortization of bond discount LO P2 Tano issues bonds with a par value of $92,000 on January 1, 2017. The bonds’ annual contract rate is 10%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12%, and the bonds are sold for $87,480. 1. What is the amount of the discount on these bonds at issuance? 2. How much...
Exercise 10-6 Straight-Line: Recording bond issuance and discount amortization LO P2 Dobbs Company issues 9%, two-year...
Exercise 10-6 Straight-Line: Recording bond issuance and discount amortization LO P2 Dobbs Company issues 9%, two-year bonds, on December 31, 2019, with a par value of $109,000 and semiannual interest payments. Semiannual Period-End (0) 12/31/2019 (1) 6/30/2020 (2) 12/31/2020 (3) 6/30/2021 (4) 12/31/2021 Unamortized Discount $6,180 4,635 3,090 1,545 Carrying Value $102,820 104,365 105,918 107,455 199,000 Use the above straight-line bond amortization table and prepare journal entries for the following. Required: (a) The issuance of bonds on December 31, 2019....
Exercise 14-4 Straight-Line: Amortization of bond discount Tano Company issues bonds with a par value of...
Exercise 14-4 Straight-Line: Amortization of bond discount Tano Company issues bonds with a par value of $180,000 on January 1, 2019. The bonds' annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in the years. The annual market rate at the date of issuance is 10%, and the bonds are sold for $170,862. 1. What is the amount of the discount on these bonds at issuance? 2. How much total...
Exercise 10-7 Straight Line: Amortization table. Help Sav Required information Exercise 10-7 Straight-Line: Amort...
Exercise 10-7 Straight Line: Amortization table.
Help Sav Required information Exercise 10-7 Straight-Line: Amortization table and bond interest expense LO P2 (The following information applies to the questions displayed below) Duval Co, issues four-year bonds with a $110,000 par value on January 1, 2019, at a price of $105,895. The annual contract rate is 7%, and interest is paid semiannually on June 30 and December 31. Exercise 10-7 Part 1 1. Prepare a straight-line amortization table for these bonds. (Round...
Exercise 10-2 Straight-Line: Amortization of bond discount LO P2 Tano issues bonds with a par value...
Exercise 10-2 Straight-Line: Amortization of bond discount LO P2 Tano issues bonds with a par value of $92,000 on January 1, 2017 The bonds' annual contract rate is 10 %, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12 % , and the bonds are sold for $87.480. 1. What is the amount of the discount on these bonds at issuance?...
Auerbach Inc. issued 6% bonds on October 1, 2021. The bonds have a maturity date of...
Auerbach Inc. issued 6% bonds on October 1, 2021. The bonds have a maturity date of September 30, 2031 and a face value of $250 million. The bonds pay interest each March 31 and September 30, beginning March 31, 2022. The effective interest rate established by the market was 8%. Assuming that Auerbach issued the bonds for $216,024,975, what interest expense would it recognize in its 2021 Income statement? (Do not round intermediate calculations. Round your final answer to nearest...
Exercise 10-4 Straight-Line: Amortization of bond discount LO P2 Tano Company issues bonds with a par...
Exercise 10-4 Straight-Line: Amortization of bond discount LO P2 Tano Company issues bonds with a par value of $81,000 on January 1, 2019. The bonds' annual contract rate is 6%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $76,753. 1. What is the amount of the discount on these bonds at issuance? 2. How...
cCan someone let me know if this is correct? Recording Noninterest-Bearing Note Payable Entries First Choice...
cCan someone let me know if this is
correct?
Recording Noninterest-Bearing Note Payable Entries First Choice Company buys equipment on October 1, 2020, providing as payment a noninterest-bearing note for $32,000 to be paid one year from today. The equipment could be purchased for $29,091 in cash today. Record the entries for First Choice Company on the following dates. a. Issuance of the note on October 1, 2020. b. Adjusting entry on December 31, 2020, First Choice Company's fiscal year-end....
On June 1, 2018, Dirty Harry Co. borrowed cash by issuing a 6-month noninterest-bearing note with a maturity value of $440,000 and a discount rate of 6%. Assuming straight-line amortization of the discount, what is the carrying value of the note as of September 30, 2018? (Round all calculations to the nearest whole dollar amount.) Multiple Choice 0 $426,800 O $418,000 0 $462.000 0 $435,600
Analyzing Interest-Bearing and Noninterest-Bearing Notes Consider the following three separate scenarios for a one-year, $300,000 note payable issued on September 1, 2020. Complete the table, using the straight-line method to amortize any discount on note payable. Note: Round your answers to the nearest whole dollar. $300,000 Note payable $300,000 Note payable 12% Interest due at maturity 10% interest due at maturity 12% market rate 10% market rate Borrower's FYE*: Dec. 31 Borrower's FYE: Nov. 30 $300,000 Note payable Noninterest-bearing 12%...
Exercise 10-6 Straight-Line: Recording bond issuance and discount amortization LO P2 Dobbs Company issues 9%, two-year bonds, on December 31, 2019, with a par value of $109,000 and semiannual interest payments. Semiannual Period-End (0) 12/31/2019 (1) 6/30/2020 (2) 12/31/2020 (3) 6/30/2021 (4) 12/31/2021 Unamortized Discount $6,180 4,635 3,090 1,545 Carrying Value $102,820 104,365 105,918 107,455 199,000 Use the above straight-line bond amortization table and prepare journal entries for the following. Required: (a) The issuance of bonds on December 31, 2019....
Exercise 14-4 Straight-Line: Amortization of bond discount Tano Company issues bonds with a par value of $180,000 on January 1, 2019. The bonds' annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in the years. The annual market rate at the date of issuance is 10%, and the bonds are sold for $170,862. 1. What is the amount of the discount on these bonds at issuance? 2. How much total...
Exercise 10-7 Straight Line: Amortization table.
Help Sav Required information Exercise 10-7 Straight-Line: Amortization table and bond interest expense LO P2 (The following information applies to the questions displayed below) Duval Co, issues four-year bonds with a $110,000 par value on January 1, 2019, at a price of $105,895. The annual contract rate is 7%, and interest is paid semiannually on June 30 and December 31. Exercise 10-7 Part 1 1. Prepare a straight-line amortization table for these bonds. (Round...
Exercise 10-2 Straight-Line: Amortization of bond discount LO P2 Tano issues bonds with a par value of $92,000 on January 1, 2017 The bonds' annual contract rate is 10 %, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12 % , and the bonds are sold for $87.480. 1. What is the amount of the discount on these bonds at issuance?...
Auerbach Inc. issued 6% bonds on October 1, 2021. The bonds have a maturity date of September 30, 2031 and a face value of $250 million. The bonds pay interest each March 31 and September 30, beginning March 31, 2022. The effective interest rate established by the market was 8%. Assuming that Auerbach issued the bonds for $216,024,975, what interest expense would it recognize in its 2021 Income statement? (Do not round intermediate calculations. Round your final answer to nearest...
Exercise 10-4 Straight-Line: Amortization of bond discount LO P2 Tano Company issues bonds with a par value of $81,000 on January 1, 2019. The bonds' annual contract rate is 6%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $76,753. 1. What is the amount of the discount on these bonds at issuance? 2. How...
cCan someone let me know if this is
correct?
Recording Noninterest-Bearing Note Payable Entries First Choice Company buys equipment on October 1, 2020, providing as payment a noninterest-bearing note for $32,000 to be paid one year from today. The equipment could be purchased for $29,091 in cash today. Record the entries for First Choice Company on the following dates. a. Issuance of the note on October 1, 2020. b. Adjusting entry on December 31, 2020, First Choice Company's fiscal year-end....
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