answers to the worksheet

Unit 15 Classwork i Bonds at Face Value 1. If the 8 price of a bond is less than the face amount or the market rate h than the contract rate, the bond is selling at 2. If the amount andcontract e selling price and market rate of a bond is equal to the face rate, the bond is selling at he selling price is greater than the face amount of a bond and the ma than the 3. If t market rate is less contract rate, the bond is selling at oses Corporation issued a bond with a contract interest rate of 10% The market rate of a bond is 9%. Is the bond being issued at a discount, amount? Would the selling price be higher or lower than the face 4. R current premium, orface amount? contract rate be a discount, premium, 5. The Garden Supply issued a $1,000,000 bond for $975,000. Would the higher or lower than the market rate? Is the bond being issued aft or face amount? On January 1, the first day of the fiscal year, a company issues a $ bond that pays semiannual interest of $12,500 ($500,000 x 5% x % of $500,000. Journalize the entries to record (a) the issuance of the interest payment 500,000, 5%, 10-year , receiving cash bonds, (b) the first on June 30, and (c) the payment of the principal on the maturity date. 6. the first day of the fiscal year, a company issues a $800,000, 4%, 10-year On January 1, bond that pays semiannual interest of $16,000 ($800,000 x 4% x 7. year), receiving cash of $800,000. Journalize the entries to record (a) the issuance of the bonds, (b) the first interest payment on June 30, and (c) the payment of the principal on the maturity date. 8. Gabriel Co. produces and distributes semiconductors for use by computer manufacturers. Gabriel Co. issued $600,000 of 10-year, 8% bonds on May 1 of the current year at face value, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year. Journalize the entries to record the May 1. Issued the bonds for cash at their face amount Nov. 1. Paid the interest on the bonds. Dec. 31. Recorded accrued interest for two months selected transactions for the current year