On May 1, 2020, Auto Corp. purchased a five-year, 4.5 percent bond. It intends to hold the
Question:
On May 1, 2020, Auto Corp. purchased a five-year, 4.5 percent bond. It intends to hold the bond until it matures. The market rate on the purchase date was 5.2 percent. Interest is paid annually each April 30. Information about the bond appears in the table below. Journalize the purchase and the April 30, 2021, entries.
Transcribed Image Text:
Annual Interest Period Interest Discount Unamortized Bond Carrying 1 Interest Period Received 4.50% Discount Balance Value Revenue Amort. May 1, 2020 $30,100 $ 969,900 April 30, 2021 $ 45,000 $ 50,435 $ 5,435 24,665 3 975,335 4 April 30, 2022 45,000 50,717 5,717 18,948 981,052 April 30, 2023 45,000 51,015 6,015 12,933 987,067 6 April 30, 2024 45,000 51,327 6,327 6,606 993,394 7 April 30, 2025 45,000 51,606 6,606 1,000,000 8. Total $225,000 $255,100 $30,100 2. 00
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 62% (8 reviews)
ANSWER Date Account Debit Credit May 1 2020 Bond Investment 96990000 Cash 96990000 April 30 2021 Ca...View the full answer
Answered By
Aketch Cindy Sunday
I am a certified tutor with over two years of experience tutoring . I have a passion for helping students learn and grow, and I firmly believe that every student has the potential to be successful. I have a wide range of experience working with students of all ages and abilities, and I am confident that I can help students succeed in school.
I have experience working with students who have a wide range of abilities. I have also worked with gifted and talented students, and I am familiar with a variety of enrichment and acceleration strategies.
I am a patient and supportive tutor who is dedicated to helping my students reach their full potential. Thank you for your time and consideration.
0.00
0 Reviews
10+ Question Solved
Related Book For
Horngrens Accounting
ISBN: 9780135359785
11th Canadian Edition Volume 2
Authors: Tracie Miller Nobles, Brenda Mattison, Ella Mae Matsumura, Carol A. Meissner, Jo Ann Johnston, Peter R. Norwood
Question Posted:
Students also viewed these Business questions
-
Purchase of a bond worth 240m market interest rate was 8% and bond interest rate was 6%. It was bought July 1 and paid semi annually, at December 31 its amortized cost was 200.8 million while its...
-
For the purpose of providing yearly scholarships to poor but deserving students, a wealthy engineer made a lump-sum deposit in an endowment fund set up by a well-known university. The fund will...
-
On April 30, 2016, Witt Corp. had outstanding 8%, $1,000,000 face amount, convertible bonds maturing on April 30, 2024. Interest Is payable on April 30 and October 31. On April 30, 2016, all these...
-
Consider the nutrition problem in Example 1 of Section 3.3. Solve the problem by the simplex method, and then determine the optimal quantities of soybeans and rice in the diet, and the new cost, if...
-
As a small group, discuss the following statement: "Regression is such a basic technique that it should always be used in analyzing data."
-
Fill in the Blank. \(Z(i \omega)=-m \omega^{2}+i \omega c+k\) is called the mechanical ___________ .
-
The fiscal year 2017 annual report of General Mills, Inc. is available on this book's Website. Refer to the consolidated balance sheet, and Note 8. Required a. What was the total dollar amount of...
-
The following information was taken from the records of Crowley Cosmetics, Inc., at December 31, 2012: Requirements 1. Prepare Crowley Cosmetics single-step income statement, which lists all revenues...
-
Are there any measures or metrics for global supply chains? What impact have they experienced since the pandemic and the war in Ukraine? How are global supply chains changing due to these factors
-
Avie Products Inc. is planning to add a third shift to its production schedule. It currently has 450 workers involved in all aspects of its fertilizer business, best done in Canada. A recent surge in...
-
How would you measure the net income of a parent company with three subsidiaries? Assume that two subsidiaries are wholly owned (100 percent) and that the parent owns 60 percent of the third...
-
On March 31, 2020, Kingpin Corp. paid 98.25 for 4 percent bonds of Claim Limited as an investment. The maturity value of the bonds is $100,000 at September 30, 2024; they pay interest on March 31 and...
-
What are the potential costs and benefits of policies designed to improve the flexibility of labour markets?
-
Explain some of the limitations placed on these rights by citing at least three instances where this has happened. This means finding three cases where the Bill of Rights protections have been...
-
contains only direct materials. Compute the Cost of Goods Manufactured and Cost of Goods Sold for West Nautical Company for the most recent year using the amounts described next. Assume that Raw...
-
Write a Go program that processes a list of messages using a concurrent function. A main function passes the list of messages to a go function that encrypts each message and send each resulting...
-
Discuss the role of entropy in enzymatic catalysis, specifically in terms of transition state stabilization and the concept of entropy-enthalpy compensation ?
-
What advancements in supramolecular chemistry have been instrumental in developing new classes of organocatalysts, and how do these developments influence catalytic efficiency and chiral induction ?
-
The assembly shown is used to control the tension T in a tape that passes around a frictionless spool at E. Collar C is welded to rods ABC and CDE. It can rotate about shaft FG but its motion along...
-
Using a graphing utility, graph y = cot -1 x.
-
Nicholas Rausch issued $300,000 of 11%, 10-year bonds payable on January 1, 2014. The market interest rate at the date of issuance was 10% and the bonds pay interest semiannually. Requirements 1. How...
-
Describe a common-size statement and how it might be helpful in evaluating a company.
-
What are product costs?
-
Next year, the economy is expected to be in recession with probability 0 . 3 and in expansion with probability 0 . 7 . In the case of recession, the return on stock X is expected to be - 5 % and the...
-
Aria Acoustics, Inc. ( AAI ) , projects unit sales for a new seven - octave voice emulation implant as follows: Year Unit Sales 1 9 1 , 0 0 0 2 1 0 4 , 0 0 0 3 1 1 8 , 0 0 0 4 1 1 3 , 0 0 0 5 9 4 , 0...
-
Steve's house was destroyed in a tornado in 2023. He purchased the house for $150,000 in September 2012. The fair market value of the house before the tornado was $400,000 and the fair market value...
Study smarter with the SolutionInn App