Question

please show excel calculations!

You should turn in your answers in ONE Excel document. Use financial formulas in Excel to show work for Requirement #1 and #5 of each part. An assignment submitted that doesn't demonstrate your formulas within Excel will receive an unsatisfactory grade. PART B Bill Corporation issued five-year, 6% bonds with a total face value of $1,000,000 on January 1, 2019. Interest is paid semi-annually on June 30 and December 31. The market rate of interest on this date was 8.0%. Bill uses the effective interest rate method. Required: 1. Using Excel, prepare a five-year bond amortization schedule for these bonds. There are examples in your notes and posted on D2L. Use formulas and reference cells in Excel to show how you calculate your numbers. 2. Prepare journal entries to record (1) the sale of the bonds on January 1, 2019, (2) the interest payment for the period ended June 30, 2019 and, (3) the final interest and face value payment at maturity on December 31, 2024. 3. Show how the balance sheet would report the bond liability and related premium/discount on December 31, 2020.

Answer 1

D 1 2 A Bill Corporation Bond Discount Amortization Table-Effective Interest Method 3 Date Interest Payment @ 3% Interest Expense @ 4% Discount Amortization Bond Discount Balance Book Value of Bond 4 1-Jan-19 $ 81,109 | $ 918,891 5 30-Jun-19 $ 30,000 $ 36,756 $ 6,756 $ 74,353 $ 925,647 6 31-Dec-19 $ 30,000 $ 37,026 $ 7,026 $ 67,327 $ 932,673 7 30-Jun-20$ 30,000 $ 37,307 $ 7,307 $ 60,021 $ 939,979 8 31-Dec-20 $ 30,000 $ 37,599 $ 7,599 $ 52,421 $ 947,579 9 30-Jun-21 $ 30,000 $ 37,903 $ 7,903 $ 44,518 $ 955,482 10 31-Dec-21 $ 30,000 $ 38,219 $ 8,219 $ 36,299 $ 963,701 11 30-Jun-22 $ 30,000 $ 38,548 $ 8,548 $ 27,751 $ 972 249 12 31-Dec-22 $ 30,000 $ 38,890 $ 8,890 $ 18,861 $ 981,139 13 30-Jun-23 $ 30,000 $ 39,246 $ 9,246 $ 9,615 $ 990,385 14 31-Dec-23 $ 30,000 $ 39,615 $ 9,615 $ 1,000,000 15 Credit 16 17 Date General Journal 1/1/2019 Cash $ Discount on Bonds Payable $ 6% bonds Payable Debit 918,891 81,109 18 19 20 $ 1,000,000 Bill Corporation Balance Sheet (Partial) Dec 31 2020 Long Term Liabilities 6% Bonds Payable $1,000,000 Less Discount on Bonds Payable $ (52,421) Net Book Value of Bond $947,579 21 2461201001linteract Eynence 5 3 6 756 22 6/30/2019 Interest Expense Cash Discount on Bonds Payable 30,000 6,756 23 24 39,615 1,000,000.00 12/31/2023 Interest Expense 6% Bonds Payable Discount on Bonds Payable Cash 9,615 1,030,000

D AB Bill Corporation 2 Bond Discount Amortization Table-Effective Interest Method 3 Date Interest Payment @ 3% Interest Expense @ 4% Discount Amortization Bond Discount Balance Book Value of Bond 4 43466 0 = 1000000-F4 =PV(0.04.10,-1000000*3% -1000000) 5 43646 =1000000*3% =F4*4% =C5-B5 =E4-D5 =F4+D5 6 43830 =1000000*3% =F5*4% =C6-B6 =E5-D6 =F5+D6 7 44012 =1000000*3% =F6*4% =C7-B7 =E6-D7 =F6+D7 8 44196 =1000000*3% =F7*4% =C8-B8 =E7-D8 =F7+D8 9 44377 =1000000*3% =F8*4% =C9-B9 =E8-D9 =F8+D9 10 44561 =1000000*3% =F9*4% =C10-B10 =E9-D10 =F9+D10 11 44742 =1000000*3% =F10*4% =C11-B11 =E10-D11 =F10+D11 12 44926 =1000000*3% =F11*4% =C12-B12 =E11-D12 =F11+D12 13 45107 =1000000*3% =F12*4% =C13-B13 =E12-D13 =F12+D13 14 45291 =1000000*3% I=F13*4% =C14-B14 =E13-D 14 =F13+D14 15 16 Date General Journal Debit Credit 17 43466 Cash =F4 18 Discount on Bonds Payable =E4 Discount 19 6% bonds Payable =SUM(C17:C18) Bill Corporation Balance Sheet (Partial) Dec 31 2020 Long Term Liabilities 6% Bonds Payable 1000000 Less Discount on Bonds Payable --E8 Net Book Value of Bond =SUM(120:121) 20 =C5 21 43646 Interest Expense 22 Cash 23 Discount on Bonds Payable =B5 =C21-D22 24 39615 =F14 25 45291 Interest Expense 26 6% Bonds Payable Discount on Bonds Payable 28 Cash 27 =D14 =C25+C26-D27 29

The Bonds will mature on 31 Dec 2023 but the question 2(C) mentioned maturity date of Dec 31 2024

if the question is wrong then the entry mentioned in image on 31 Dec 2023 is correct

if the question is correct then there will be no entry on Dec 31 2024