Homework Answers
When issue price of bonds is lower than face value of bonds then it is called bond is issued at discount
But when issue price of bonds is higher than face value of bonds then it is called bond is issued at premium
So answer is a) the bonds were sold at a premium
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_2. Bonds with par value of $500,000 carrying a stated interest rate of 6% payable semiannually...
Problem 8 Rockne, Inc. issued $500,000 face value of convertible 10-year, 11% stated rate bonds on...
Problem 8 Rockne, Inc. issued $500,000 face value of convertible 10-year, 11% stated rate bonds on July 1, 2014. The interest is payable semiannually on December 31 and June 30. The discount in connection with the issue was $4,750, which is amortized monthly using the straight-line basis. The bonds are convertible after one year into five shares of Rockne's common stock (no par value) for each $1,000 of bonds. On October 1, 2015, $150,000 face value of the bonds were...
Spiller Corp. plans to issue 8%, 8-year, $570,000 par value bonds payable that pay interest semiannually...
Spiller Corp. plans to issue 8%, 8-year, $570,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated December 31, 2019, and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is...
Your company issues bonds with a face value of $500,000. The stated rate is 4%, interest is paid semi- annually, and the...
Your company issues bonds with a face value of $500,000. The stated rate is 4%, interest is paid semi- annually, and the bonds mature in 10 years. The bonds are issued with an effective yield of 4.125% The bonds are issued at a [ Select ] ["Discount", "Premium", "Par"] The bonds are sold for [...
Adonis Corporation issued 10-year, 9% bonds with a par value of $180,000. Interest is paid semiannually....
Adonis Corporation issued 10-year, 9% bonds with a par value of $180,000. Interest is paid semiannually. The market rate on the issue date was 8%. Adonis received $192,233 in cash proceeds. Which of the following statements is true? Multiple Choice Adonis must pay $192,233 at maturity and no interest payments. Adonis must pay $180,000 at maturity plus 20 interest payments of $8,100 each. Adonis must pay $180,000 at maturity plus 20 interest payments of $7,200 each. Adonis must pay $192,233...
Adonis Corporation issued 10-year, 7% bonds with a par value of $190,000. Interest is paid semiannually....
Adonis Corporation issued 10-year, 7% bonds with a par value of $190,000. Interest is paid semiannually. The market rate on the issue date was 6%. Adonis received $204,138 in cash proceeds. Which of the following statements is true? Multiple Choice A. Adonis must pay $190,000 at maturity and no interest payments. B. Adonis must pay $190,000 at maturity plus 20 interest payments of $5,700 each. C. Adonis must pay $190,000 at maturity plus 20 interest payments of $6,650 each. D.Adonis...
Bonds Payable – Issued “plus accrued interest ”. Jump Company issued $200,000 of bonds payable...
Bonds Payable – Issued “plus accrued interest ”. Jump Company issued $200,000 of bonds payable at face value on April 1, 2016. The bonds were authorized on January 1, 2016, with a stated rate of 4% and a maturity date of December 31, 2025. Interest payments are to be made annually, starting December 31, 2016. Because the authorization date preceded the issue date, the bonds were issued “plus accrued interest.” Prepare the following journal entries. Note, there are two...
Spiller Corp. plans to issue 8%, 8-year, $560,000 par value bonds payable that pay interest semiannually...
Spiller Corp. plans to issue 8%, 8-year, $560,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated December 31, 2019, and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 1,000 Effective interest rate 1,000 Interest Paid Per Year 4% Payment dates 1/11/20X2 12/31/20X6 Years to maturity 101% 1/1/X6 January 1st July 1st 5 Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% USE STRAIGHT LINE AMORTIZATION FOR THE GAIN OR...
Issue Price Matthison Harcourt plans to issue $500,000 face value bonds with a stated interest rate...
Issue Price Matthison Harcourt plans to issue $500,000 face value bonds with a stated interest rate of 8%. They will mature in 6 years. Interest will be paid semiannually. At the date of issuance, assume that the market rate is (a) 8%, (b) 6%, and (c) 10%. Use the appropriate present value table: PV of $1 and PV of Annuity of $1 Required: For each market interest rate, answer the following questions. Round calculations and answers to the nearest whole...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 7,000 Effective interest rate 1,000 Interest Paid Per Year 4% Payment dates 1/120X2 12/31/20X6Years to maturity 707% 1/1/X6 January 1st July 1st Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% USE STRAIGHT LINE AMORTIZATION FOR THE GAIN OR LOSS CALCULATIONS....
Problem 8 Rockne, Inc. issued $500,000 face value of convertible 10-year, 11% stated rate bonds on July 1, 2014. The interest is payable semiannually on December 31 and June 30. The discount in connection with the issue was $4,750, which is amortized monthly using the straight-line basis. The bonds are convertible after one year into five shares of Rockne's common stock (no par value) for each $1,000 of bonds. On October 1, 2015, $150,000 face value of the bonds were...
Spiller Corp. plans to issue 8%, 8-year, $560,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated December 31, 2019, and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 1,000 Effective interest rate 1,000 Interest Paid Per Year 4% Payment dates 1/11/20X2 12/31/20X6 Years to maturity 101% 1/1/X6 January 1st July 1st 5 Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% USE STRAIGHT LINE AMORTIZATION FOR THE GAIN OR...
PROBLEM #1: Bonds payable FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 7,000 Effective interest rate 1,000 Interest Paid Per Year 4% Payment dates 1/120X2 12/31/20X6Years to maturity 707% 1/1/X6 January 1st July 1st Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% Additional Facts: Bonds called on Called at Years after issue 1/1/20X6 101% USE STRAIGHT LINE AMORTIZATION FOR THE GAIN OR LOSS CALCULATIONS....
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