10 11 12 13 14 15 16 17 What is the journal entry to record issuing a $1,000,000 bond for 5926,405? What is the journal entry to record issuing a $1,000,000 bond for $1,038,606 OBJECTIVE 3 TOPIC- Reporting of Bonds Payable Bonds Payable": Regarding the account "Discount What is the normal balance? What type of an account is it? What statement does it show up on? What is the normal balance of the "Premium of Bonds Payable": What is the normal balance? What type of an account is it? What statement does it show up on? OBJECTIVE TOPIC-The Times Interest Earned Ratio: NOTE: As creditors, bondholders are concerned with the company's ability to pay its interest payments and repay the maturity value of the bonds. NOTE: Analysts assess this risk by calculating the times interest earned ratio. This ratio tells the number of times interest payments could be paid out of current period earnings. This measures the company's ability to pay its interest payments. NOTE: It is computed as: times interest earned-income begane income far crpense + interest expense) in crest cxpense. . DEFINE the following: Times Interest Earned: What does the times interest earned ratio compare the "pool" of money available for interest payments to? Which of the following is favorable? The larger the pool of money" or the smaller the pool of money"? OBJECTIVE 5 TOPIC-The Selling Price of Bond Payable Using Present Value Concepts What is the name of the rate used to calculate the interest payment on a Bond, Contraet Rate or Market Rate? What is the name of the rate used to caleulate the present Value of a Bond, Contract Rate or Market Rate? OBJECTIVE 6 TOPIC- The Effective Interest Rate Method of Amortizing Bond Discounts and Premiums, What is the primary diffcrcoce between the effective interest rate method and the straight-line-method in calculating the amount interest expense cach period? 10 11 12 13 14 15 16 17 What is the journal entry to record issuing a $1,000,000 bond for 5926,405? What is the journal entry to record issuing a $1,000,000 bond for $1,038,606 OBJECTIVE 3 TOPIC- Reporting of Bonds Payable Bonds Payable": Regarding the account "Discount What is the normal balance? What type of an account is it? What statement does it show up on? What is the normal balance of the "Premium of Bonds Payable": What is the normal balance? What type of an account is it? What statement does it show up on? OBJECTIVE TOPIC-The Times Interest Earned Ratio: NOTE: As creditors, bondholders are concerned with the company's ability to pay its interest payments and repay the maturity value of the bonds. NOTE: Analysts assess this risk by calculating the times interest earned ratio. This ratio tells the number of times interest payments could be paid out of current period earnings. This measures the company's ability to pay its interest payments. NOTE: It is computed as: times interest earned-income begane income far crpense + interest expense) in crest cxpense. . DEFINE the following: Times Interest Earned: What does the times interest earned ratio compare the "pool" of money available for interest payments to? Which of the following is favorable? The larger the pool of money" or the smaller the pool of money"? OBJECTIVE 5 TOPIC-The Selling Price of Bond Payable Using Present Value Concepts What is the name of the rate used to calculate the interest payment on a Bond, Contraet Rate or Market Rate? What is the name of the rate used to caleulate the present Value of a Bond, Contract Rate or Market Rate? OBJECTIVE 6 TOPIC- The Effective Interest Rate Method of Amortizing Bond Discounts and Premiums, What is the primary diffcrcoce between the effective interest rate method and the straight-line-method in calculating the amount interest expense cach period