1 | ||||
Date | Cash paid | Interest expense | Increase in Carrying value | Carrying value |
01/01/2021 | 394979 | |||
06/30/2021 | 17200 | 17774 | 574 | 395553 |
12/31/2021 | 17200 | 17800 | 600 | 396153 |
06/30/2022 | 17200 | 17827 | 627 | 396780 |
12/31/2022 | 17200 | 17855 | 655 | 397435 |
2 | ||||
Debit | Credit | |||
Dec 31,2022 | Bonds payable | 430000 | ||
Loss on redemption of Bonds | 109435 | |||
Discount on Bonds payable | 32565 | =430000-397435 | ||
Cash | 506870 | |||
Cash paid = Face amount × 4% Stated rate | ||||
Interest expense = Carrying value × 4.5% Market rate | ||||
Increase in carrying value = Interest expense - Cash paid |
Required information [The following information applies to the questions displayed below.) On January 1, 2021. Splash...
Required information The following information applies to the questions displayed below.) On January 1, 2021, Splash City issues $350,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 9% and the bonds issued at $321494. Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $323,493 on December 31, 2022. (Round Interest expense to nearest whole...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, Splash City issues $450,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 8% and the bonds issued at $419,422. Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $423,782 on December 31, 2022. (Round Interest expense to nearest whole...
Required information [The following information applies to the questions displayed below] On January 1, 2021, Splash City issues $390,000 of 7 % bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year Assuming the market interest rate on the issue date is 8 %, the bonds wil issue at $363,500. Required: 1. Complete the first three rows of an amortization table. (Round your intermediate and final answers to the nearest whole dollar.) Change...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, Splash City issues $400,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 9% and the bonds issued at $367,422. If the market interest rate drops to 6% on December 31, 2022, it will cost $471,507 to retire the bonds. Record the retirement of the bonds...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, White Water issues $530,000 of 6% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 5% and the bonds issued at $596,522 Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $590,217 on December 31, 2023. (Round your interest expense to the...
Required information [The following information applies to the questions displayed below.) On January 1, 2021, Splash City issues $320,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 9% and the bonds issued at $293,938. 2. If the market interest rate drops to 7% on December 31, 2022, it will cost $347,025 to retire the bonds. Record the retirement of the...
Required information [The following information applies to the questions displayed below.) On January 1, 2021, Splash City issues $400,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 9% and the bonds issued at $367,422. 2. If the market interest rate drops to 6% on December 31, 2022, it will cost $471,507 to retire the bonds. Record the retirement of the...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, Splash City issues $470,000 of 9% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year Assuming the market interest rate on the issue date is 10%, the bonds will issue at $429,678 2. Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. (If...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, Splash City issues $380,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 9%, the bonds will issue at $349,051. 2. Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. (If...
Required information [The following information applies to the questions displayed below.] On January 1, 2021, Splash City issues $410,000 of 9% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 8%, the bonds will issue at $450,576. 2. Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. (If...