Question
a) CeCe Winans Corporation incurred the following costs in connection with the issuance of bonds: (1) printing and engraving costs, $13,040; (2) legal fees, $50,280,
a) CeCe Winans Corporation incurred the following costs in connection with the issuance of bonds: (1) printing and engraving costs, $13,040; (2) legal fees, $50,280, and (3) commissions paid to underwriter, $73,140.
Need Help on a,b,c Answers as follows:
What amount should be reported as Unamortized Bond Issue Costs, and where should this amount be reported on the balance sheet? (Round answer to 0 decimal places, e.g. 38,548.)
Amount to be reported as Unamortized Bond Issue Costs | $
| |
Unamortized Bond Issue Costs should be reported in Other AssetOther Liability section of the balance Sheet |
(b) George Gershwin Co. sold $2,178,000 of 12%, 9-year bonds at 105 on January 1, 2014. The bonds were dated January 1, 2014, and pay interest on July 1 and January 1. If Gershwin uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2014, and December 31, 2014.(Round answer to 0 decimal places, e.g. 38,548.)
Interest expense to be recorded | $
|
(c) Ron Kenoly Inc. issued $614,900 of 9%, 9-year bonds on June 30, 2014, for $515,035. This price provided a yield of 12% on the bonds. Interest is payable semiannually on December 31 and June 30. If Kenoly uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2014.(Round answer to 0 decimal places, e.g. 38,548.)
Interest expense to be recorded | $
|
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