Long Term Liabilities question

1. On November 1, 2020, Delia Company issued $285,000 worth of bonds at par, with the interest rate of 6% per annum. The bonds will mature on October 31, 2027. Interest will be paid semi-annu- ally on April 30 and October 31. The company has a December 31 year-end. Calculate the accrued interest payable on December 31, 2021. 2. On April 30, 2020, a company issued $620,000 worth of 5% bonds at par. The term of the bonds is 8 years, with interest payable semi-annually on October 31 and April 30. The year-end of the company is November 30. Record the journal entries related to in- terest for 2020 and 2021. Note that interest must be accrued at the end of each year. Oct 31, 2020 Interest Expense Cash Payment of band Mideast Nov 30, 2020 Interest Expense Interest Payable Accrued kremat on bonds or year and Apr 30, 2021 Interest Expense Interest Payable Cash Payment of band lotenant Oct 3) 2021 Interest Expense Cash Payment of bond losenet Interest Expense Interest Payable3. A company issued $1,180,000 worth of 9-year bonds with a 2% in- terest rate. Interest is to be paid annually. The bond issue date is January 1, 2020 and the company has a year-end of December 31. Calculate the bond issue price under each market interest rate. Market Interest Rate Bond Price 19% $Answer 296 $Answer 396 $Answer 4. A company is issuing $260,000 worth of 4-year bonds on July 9, 2020, bearing an interest rate of 2%, payable annually. Assume that the current market rate of interest is 5%. a) Will the bonds be issued at a discount or at a premium? b) Calculate the value of the resulting discount or premium. c) Record the journal entry to reflect the sale of bonds and the ap- propriate discount or premium. Note that the present value factor for the principal is 0.8227 (5%, 4-years) and that the present value factor for the recurring inter- est payment is 3.5460 (5%, 4-years). Discount or premium amount: $Answer Date Account Title and Explanation Debit Credit Answer Cash Jul 9 Answer Answerl Discount on Bonds Payable Answer Answer Bonds Payable Answer Issue of bonds at discount or premium