I need help with all 7 requirements. Thank You!
principal | 660,000 | |||||||
interest paid on bonds 660,000*2%= | 13200 | |||||||
For Principal use PV of $1 table at 2.5% for 8 years | ||||||||
for interest use PV of ordinary annuity table at 2.5% for 8 years | ||||||||
1) | Calculation of bonds issue price | |||||||
table values are based on | ||||||||
n= | 8 | |||||||
i= | 2.50% | |||||||
Cash flow | Amount | PV | ||||||
principal | 660,000 | 541695 | (660,000*.82075) | |||||
interest expense | 13200 | 94646 | (13200*7.17014) | |||||
price of bonds | 636341 | |||||||
(please use factor table as given in your question ) | ||||||||
2) | Date | Accoounting titles & Explanations | Debit | Credit | ||||
1/1/2021 | Cash | 636341 | ||||||
Discount on bonds payable | 23,659 | |||||||
Bonds payable | 660,000 | |||||||
3) | interest | cash | bond | discount | carring | |||
period | interest | interest | amortizatioon | value | ||||
end | expense | |||||||
2.50% | ||||||||
1/1/2021 | 636341 | |||||||
06/30/21 | 13200 | 15909 | 2709 | 639049 | ||||
12/31/21 | 13200 | 15976 | 2776 | 641826 | ||||
06/30/22 | 13200 | 16046 | 2846 | 644671 | ||||
12/31/22 | 13200 | 16117 | 2917 | 647588 | ||||
06/30/23 | 13200 | 16190 | 2990 | 650578 | ||||
12/31/23 | 13200 | 16264 | 3064 | 653642 | ||||
06/30/24 | 13200 | 16341 | 3141 | 656783 | ||||
12/31/24 | 13200 | 16418 | 3217 | 660000 | ||||
total | 105600 | 129260 | 23659 | |||||
4) | Date | Accoounting titles & Explanations | Debit | Credit | ||||
30/6/2021 | interest expense | 15909 | ||||||
Discount on bonds | 2709 | |||||||
cash | 13200 | |||||||
5) | December 31,2021 book value | 641826 | ||||||
6) | interest expense for 2021 | 31885 | ||||||
7) | ||||||||
Date | Accoounting titles & Explanations | Debit | Credit | |||||
12/31/24 | interest expense | 16418 | ||||||
Discount on bonds | 3217 | |||||||
cash | 13200 | |||||||
bonds payable | 660,000 | |||||||
cash | 660,000 |
I need help with all 7 requirements. Thank You! When Patey Pontoons issued 4% bonds on...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a face amount of $660,000, the market yield for bonds of similar risk and maturity was 5%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 8% bonds on January 1, 2021, with a face amount of $540,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a face amount of $660,000, the market yield for bonds of similar risk and maturity was 5%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a
face amount of $520,000, the market yield for bonds of similar risk
and maturity was 5%. The bonds mature December 31, 2024 (4 years).
Interest is paid semiannually on June 30 and December 31. (FV of
$1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)
(Use appropriate factor(s) from the tables
provided.)
Required:
1. Determine the price of the bonds...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a face amount of $820,000, the market yield for bonds of similar risk and maturity was 5%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 10% bonds on January 1, 2021, with a face amount of $800,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 10% bonds on January 1, 2021, with a face amount of $640,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31(EV of 51, PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds at...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a face amount of $820,000, the market yield for bonds of similar risk and maturity was 5%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 4% bonds on January 1, 2021, with a face amount of $520,000, the market yield for bonds of similar risk and maturity was 5%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, EVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...
When Patey Pontoons issued 10% bonds on January 1, 2021, with a face amount of $560,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...