Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Huskey Mining Corporation issued bonds with a par value of $105,000 on January 1, 2020. The annual contract rate on the bonds is 9%, and

image text in transcribed
image text in transcribed
Huskey Mining Corporation issued bonds with a par value of $105,000 on January 1, 2020. The annual contract rate on the bonds is 9%, and the interest is paid semiannually. The bonds mature after three years. The annual market interest rate at the date of Issuance was 11%, and the bonds were sold for $99.755. a. What is the amount of the original discount on these bonds? Discount b. How much total bond interest expense will be recognized over the life of these bonds? (Do not round intermediate calculations. Round the final onswer to the nearest whole dollar) Total interest expense c. Present an amortization table for these bonds; use the effective interest method of allocating the interest and amortizing the discount. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar. Enter all the amounts as positive values.) Period natin Cash Interest Period interest Finance Discount amortization Unamortized Nierunt Carrying Value c. Present an amortization table for these bonds, use the effective interest method of allocating the interest and amortizing the discount (Do not round intermediate calculations. Round the final answers to the nearest whole dollar. Enter all the amounts as positive values.) Period Ending Cash Interest Paid Period Interest Expense Discount Amortization Unamortized Discount Carrying Value Jan. 1/20 June 30/20 Dec 31/20 June 30/21 Dec 31/21 June 30/22 Dec 31/22 Totals

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

Shariah Audit Framework A Case Study Of UAE Noor Takaful Operations

Authors: Abdussalam Ismail Onagun

1st Edition

3659644064, 978-3659644061

More Books

Students also viewed these Accounting questions