Question
ACC 302/502 Name: ___________________________ Homework #1 (R) OL Date: ____________________________ On January 1, 2020, Scottsdale Company issued its 12% bonds in the face amount of
ACC 302/502 Name: ___________________________ Homework #1 (R) OL Date: ____________________________
On January 1, 2020, Scottsdale Company issued its 12% bonds in the face amount of $3,000,000, which mature on January 1, 2030. The bonds were issued for $3,368,665 to yield 10%. Scottsdale uses the effective-interest method of amortizing bond premium. Interest is payable annually on December 31. Interest Expense for 2023 is:
Answer
$_______________
On April 1, 2020, Sydney Company issued 300 $1,000 bonds at 98. Each bond was issued with one detachable stock warrant. Shortly after issuance, the bonds were selling at 94, and the warrants were selling for $50 each.
Instructions:
Prepare the entry to record the issuance of the bonds and warrants.
The Cinci Company issues $100,000, 10% bonds at 105 on September 1, 2020. The bonds are dated January 1, 2020 and mature ten years from that date. Straight-line amortization is used. Interest is paid annually each December 31. Compute the bond carrying value as of December 31, 2027. Answer
$_______________
At December 31, 2020, the following balances existed for MICPA Corporation:
Bonds Payable (6%) $600,000 Premium on Bonds Payable 40,000
The bonds mature on 12/31/27. Straight-line amortization is used. If 60% of the bonds are retired at 104 on January 1, 2027, what is the gain or loss on early extinguishment?
Answer $_______________
Required: Compute the answer for each of the four problems. Show supporting computation. No need to show questions.
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