Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1.SALE OF BONDS at premium a)WHAT IS THE PRICE OF A 934k Bond , 5 years @16% Interest, MKT rate 12%, interest paid yearly; Journalize

image text in transcribed
1.SALE OF BONDS at premium a)WHAT IS THE PRICE OF A 934k Bond , 5 years @16% Interest, MKT rate 12%, interest paid yearly; Journalize the sale on 1-1-2015. What is Bond selling at 101, 103, 105, for instance?" PRESENT VALUE OF $1 FOR FIVE YEARS at 12% .56743 Present value of annuity for five years at 12% 3.6048 b) Journalize the payment of interest expense for the first three years;12-31- 2015, 12-31-2016, and 12-31-2017, amortizing the premium/discount using the effective rate of interest. c) Journalize the payment of interest expense for the first three years;12-31- 2015, 12-31-2016, and 12-31-2017, amortizing the premium/discount using the straight-line rate of interest. d) ON 1-1-2018, the Bond was converted to 10k common stock shares at $14/share market value. The par value of the stock is $10/share. Journalize this transaction using the results of amortization in c). 1.SALE OF BONDS at premium a)WHAT IS THE PRICE OF A 934k Bond , 5 years @16% Interest, MKT rate 12%, interest paid yearly; Journalize the sale on 1-1-2015. What is Bond selling at 101, 103, 105, for instance?" PRESENT VALUE OF $1 FOR FIVE YEARS at 12% .56743 Present value of annuity for five years at 12% 3.6048 b) Journalize the payment of interest expense for the first three years;12-31- 2015, 12-31-2016, and 12-31-2017, amortizing the premium/discount using the effective rate of interest. c) Journalize the payment of interest expense for the first three years;12-31- 2015, 12-31-2016, and 12-31-2017, amortizing the premium/discount using the straight-line rate of interest. d) ON 1-1-2018, the Bond was converted to 10k common stock shares at $14/share market value. The par value of the stock is $10/share. Journalize this transaction using the results of amortization in c)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditory Cognition And Human Performance: Research And Applications

Authors: Carryl L. Baldwin

1st Edition

0415325943, 978-0415325943

More Books

Students also viewed these Accounting questions