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8) Bonds that may be redeemed by the company prior to maturity date are called a. callable bonds. b. stock bonds. c. convertible bonds d.
8) Bonds that may be redeemed by the company prior to maturity date are called a. callable bonds. b. stock bonds. c. convertible bonds d. options arson Corporation retires its bonds at 102 on January 1, following the payment of annual interest. The face value the bonds is $600,000. The carrying value of the bonds at the redemption date is $621,000. The entry to record the redemption will includea a. b. c. d. debit of $9,000 to Gain on Bond Redemption. debit of $21,000 to Loss on Bond Redemption. debit of $21,000 to Premium on Bonds Payable. debit of $12,000 to Premium on Bonds Payable. the company paid flowes from fnancing aivies for 10) Blass Company purchased treasury stock with a cost of $18000 during 2016. During the year doidends of $20,00 and sued bonds payable for proeds of $850,000. Cash 2016 total a. $812,000 net cash outflovw b. $830,000 net cash inflow c. $850,000 net cash outflow. d. $812,000 net cash inflow. 11) The market interest rate is often called the a. contractual rate. b. stated rate. c. effective rate. d. coupon rate. 12) Significant noncash transactions would include all of the following except a. b. c. d. exchange of plant assets. asset acquisition through bond issuance. conversion of bonds into common stock. treasury stock acquisition. face value of $200,000, pay interest annually on January 1, and have a call price of 101. The company uses the straight-line method of amortization. What is the carrying value of the bonds on January 1, 2017? 13) Raid Company received proceeds of $185,000 on 10-year, 6% bonds issued on January 1, 2015. The bonds had a a. $200,000 b. $188,000 c. $190,400 d. $212,000 14) A corporation recognizes a gain or loss a. only when bonds are converted into common stock. b. only when bonds are redeemed before maturity c. when bonds are redeemed at or before maturity. d. when bonds are converted into common stock and when they are redeemed before maturity. January 1. If the issuing corporation uses the straight-Hline method to amortize discount on bonds payable, the amortization amount per year is 15) On January 1, 2017, $2,000,000, 10-year, 10% bonds, were issued for $1,943,000. Interest is paid annually on a. $4,750. b. $5,700. c. $2,850. d. $19,430. TAKE HOME EX
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