Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Appling Enterprises issued 10% bonds with a face amount of $450,000 on January 1, 2018. The bonds sold for $382,292 and mature in 2037 (20

image text in transcribed

Appling Enterprises issued 10% bonds with a face amount of $450,000 on January 1, 2018. The bonds sold for $382,292 and mature in 2037 (20 years). For bonds of similar risk and maturity the market yield was 12%. Interest is paid semiannually on June 30 and December 31. Appling determines interest expense at the effective rate. Appling elected the option to report these bonds at their fair value. The fair values of the bonds at the end of each quarter during 2018 as determined by their market values in the over-the- counter market were the following: March 31 June 30 September 30 December 31 $410,000 390,000 384,000 391,000 General (risk-free) interest rates did not change during 2018. Required: 1. By how much will Appling's comprehensive income be increased or decreased by the bonds (ignoring taxes) in the March 31 quarterly financial statements? 2. By how much will Appling's comprehensive income be increased or decreased by the bonds (ignoring taxes) in the June 30 quarterly financial statements? 3. By how much will Appling's comprehensive income be increased or decreased by the bonds (ignoring taxes) in the September 30 quarterly financial statements? 4.By how much will Appling's comprehensive income be increased or decreased by the bonds (ignoring taxes) in the December 31 annual financial statements? (For all requirements, Do not round your intermediate calculations.) by by 1. Appling's comprehensive income will be 2. Appling's comprehensive income will be 3. Appling's comprehensive income will be 4. Appling's comprehensive income will be by by

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Focus On Personal Finance

Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes

2nd Edition

0073530638, 9780073530635

More Books

Students also viewed these Finance questions

Question

1. Can they separate relevant from irrelevant information?

Answered: 1 week ago

Question

Have you laid out a timeframe for refreshing the data regularly?

Answered: 1 week ago

Question

Have you laid out the information as clearly as possible?

Answered: 1 week ago

Question

Have you tested your findings with those closest to the market?

Answered: 1 week ago