Question

2) On 1 January 2008 a company receives $835,500 on the issue of 8% debentures with a nominal value of $1,000,000 redeemable
0 0
Add a comment Improve this question Transcribed image text
Answer #1

Debt Liability will be of $1000000 as the same will be repaid at the end of 5th year Total Finance Charge for 6 years: Amount

Add a comment
Know the answer?
Add Answer to:
2) On 1 January 2008 a company receives $835,500 on the issue of 8% debentures with...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • 1) On 1 January 2012, Jetty Ltd receives £6,684,000 on the issue of 8% debentures with...

    1) On 1 January 2012, Jetty Ltd receives £6,684,000 on the issue of 8% debentures with a nominal value of £8,000,000. The debentures are redeemable at the end of 2017 at par. Show in tabular form how the debentures should be recorded in the financial statements of Jetty Ltd from 2012 to 2017.

  • Question 4 On 1 January 2015, Vivek plc issued 50,000, £100 2 per cent debentures to...

    Question 4 On 1 January 2015, Vivek plc issued 50,000, £100 2 per cent debentures to investors for £55 each. The debentures are redeemable at their par value of £100 in five years’ time, 31 December 2019. The interest rate implicit for the debenture is 15.62% per annum. a) In accordance with IAS 39 Financial Instruments: Recognition and Measurement: Calculate the finance cost for Vivek plc in respect of the financial instrument, for each of the five years ended December...

  • answer 1. Davious Chomba Tapiwa PLC has in issue 10% debentures of a nominal value of...

    answer 1. Davious Chomba Tapiwa PLC has in issue 10% debentures of a nominal value of K100. The market price is K90 ex-interest. Calculate the cost of this capital if the debenture is a) Irredeemable b) Redeemable in 10 years time Ignore taxation

  • On January 1, 2017, Sheridan Corporation issued $3,800,000 of 10-year, 8% convertible debentures at 104. Interest...

    On January 1, 2017, Sheridan Corporation issued $3,800,000 of 10-year, 8% convertible debentures at 104. Interest is to be paid semiannually on June 30 and December 31. Each $1,000 debenture can be converted into 8 shares of Sheridan Corporation $100 par value common stock after December 31, 2018. On January 1, 2019, $380,000 of debentures are converted into common stock, which is then selling at $110. An additional $380,000 of debentures are converted on March 31, 2019. The market price...

  • 6. On December 31, 2007, Bolden, Inc., sold at 102 a $500,000 issue of 10% Bonds...

    6. On December 31, 2007, Bolden, Inc., sold at 102 a $500,000 issue of 10% Bonds that mature in 20 years. Bond interest is payable on June 30 and December 31. The firm uses the straight-line method of amortization. REQUIRED: Present all entries pertaining to the bonds for 2007 and 2008. Prepare the entry to record the retirement of $200,000 of the bonds At 105 on December 31, 2013 ( immediately after the interest payment On that date).

  • III. Bonds Payable issue and amortization       Carson Company issued $1,000,000 of corporate bonds on January...

    III. Bonds Payable issue and amortization       Carson Company issued $1,000,000 of corporate bonds on January 1, 2016. The bonds have a stated rate of 4 percent, and a 10 year life. The bonds were issued to yield 3 percent. The bonds pay interest annually, each December 31, starting December 31, 2016.                   A. Calculate the issue price of the bonds at 1/1/16. Show your assumptions for your calculations.       B. Prepare an amortization schedule for the bonds through...

  • Early in 2013, Beech Aircraft acquired 9 acres of land and engaged Wal-Mart to design and...

    Early in 2013, Beech Aircraft acquired 9 acres of land and engaged Wal-Mart to design and construct a manufacturing facility. Construction was started on May 1, 2013 and was completed on December 31, 2013. Beech Aircraft made the following payments to Wal-Mart during 2013: May 1, 2013 $385,000 July 31, 2013 $1,065,000 December 31, 2013 $680,000 In order to help finance the construction, Beech Aircraft issued the following during 2013: $515,000 of 10-year, 14% bonds payable, issued at par on...

  • On January 1, 2017, Spartan Corp. issued at 93, 4% bonds with a par value of...

    On January 1, 2017, Spartan Corp. issued at 93, 4% bonds with a par value of $600,000, due in 5 years. Interest is payable semiannually on June 30 and December 31 of each year. In addition, Spartan incurred bond issue costs totaling $10,000. 4 years after the issue date, On January 1, 2021, Spartan calls the entire issue at 98 and cancels it. Spartan amortizes discounts/premiums, using the straight-line method. Required: Record the necessary journal entries on January 1, 2017....

  • Part a Donahue Ltd purchased a plant on 1 July 2018 for N$300 000. The entity...

    Part a Donahue Ltd purchased a plant on 1 July 2018 for N$300 000. The entity incurred transfer fees of N$90 000. The expected dismantling cost at the end of the useful life of the plant is N$200 000. The applicable discount rate after tax (tax rate 25.75%) 6.3% Useful life 12 years The plant is erected on rented premises and the rental agreement requires dismantling of the plant at the end of its useful life. Assume that Inland Revenue...

  • III. Bonds Payable issue and amortization       Carson Company issued $1,000,000 of corporate bonds on January...

    III. Bonds Payable issue and amortization       Carson Company issued $1,000,000 of corporate bonds on January 1, 2016. The bonds have a stated rate of 4 percent, and a 10 year life. The bonds were issued to yield 3 percent. The bonds pay interest annually, each December 31, starting December 31, 2016.                   A. Calculate the issue price of the bonds at 1/1/16. Show your assumptions for your calculations.       B. Prepare an amortization schedule for the bonds through...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT