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3. Part 1 Gulf Stone company issued $ 40000 of 12 % bonds of 100 OMR each on January 1 2011. The bonds are due
3. Part 1 Gulf Stone company issued $ 40000 of 12 % bonds of 100 OMR each on January 1 2011. The bonds are due January 1 ,2016 with the interest payable each July 1 and January 1. The bonds are issued at face value. Prepare Gulf Stone journal entry for (A) January issuance (B) July 1 Interest Payment. Assume the bonds are issued at 111 to yield 9 %. Prepare the journal entries (C) January 1 for issue (D) July 1 for interest payment (E) December 31 for interest amount due. Part 2 Al Falah Company borrowed $ 100000 on March 1 on a 5 year 13 % note to help finance construction of the building. In addition, the company had outstanding all year a 12 % 5 year $1800000 note payable and 10 % 4 year $ 3200000 note payable. Compute the capitalisation rate used for interest capitalisation purpose. Part 3 Al Hamd drillers erects and places into service an off-shore oil platform on January 1, 2018, at a Cost of $ 15000000. Al Hamd is legally required to dismantle and remove the platform at the end of its usefull life in 10 years. The company estimates it will cost $ 1500000 to dismantle and remove the platform at the end of its useful life in 10 years (the fair value at January 1 2018 of the dismantle and removing cost is $ 650000). Prepare the entry to record the environmental liability
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