a)Off-balance-sheet financing is an attempt to borrow monies in such a way to prevent

recording the obligations. Explain the statement with appropriate rationale?

b) On July 1, 2016, Sugarland Company issued Tk. 2,000.000 face value of 10%. 10-year

bonds at a yield of 12%. Sugarland uses the effective interest method to amortize bond

premium or discount. The bonds pay semiannual interest on June 30 and December 31

Required:

Prepare the journal entries to record the issuance of the bonds on July 1.2016

ii. Prepare the journal entries to record the payment of interest and the amortization

of the discount on December 31, 2016: on June 30, 2017; on December 31, 2017

lli. What amount of interest expense is reported for 2017?

iv. Show the proper balance sheet presentation for the liability for bonds payable on

the December 31. 2017. balance sheet

Question#03: (2+6=08) a) Off-balance-sheet financing is an attempt to borrow monies in such a way to prevent recording the obligations Explain the statement with appropriate rationale? b) On July 1, 2016, Sugarland Company issued Tk. 2,000,000 face value of 10%, 10-year bonds at a yield of 12%. Sugarland uses the effective interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Required: i. Prepare the journal entries to record the issuance of the bonds on July 1, 2016. ii. Prepare the journal entries to record the payment of interest and the amortization of the discount on December 31, 2016, on June 30, 2017, on December 31, 2017 iii. What amount of interest expense is reported for 2017? iv. Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2017, balance sheet