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Mahalo Boat Adventure Inc. has a July 31 year-end. It showed the following partial amortization schedules regarding two bond issues: Bond Issue A Period Ending

Mahalo Boat Adventure Inc. has a July 31 year-end. It showed the following partial amortization schedules regarding two bond issues: Bond Issue A

Period Ending (A) Cash Interest Paid $700,000 8.0% 6/12 (B) Period Interest Expense (E) 7.0% 6/12 (C) Amort. (A) (B) (D) Unamortized Balance (E) Carrying Value $700,000 + (D)
June 1/23 $ 46,164 $ 746,164
Dec. 1/23 $ 28,000 $ 26,116 $ 1,884 44,280 744,280
Dec. 1/29 28,000 25,153 2,847 15,805 715,805
June 1/30 28,000 25,053 2,947 12,858 712,858
Dec. 1/30 28,000 24,950 3,050 9,808 709,808
June 1/31 28,000 24,843 3,157 6,651 706,651
Dec. 1/31 28,000 24,733 3,267 3,384 703,384
June 1/32 28,000 24,616 3,384 0 700,000
Totals $ 504,000 $ 457,836 $ 46,164

*Adjusted for rounding (For all requirements, do not round intermediate calculations. Round the final answers to the nearest whole dollar.)

Required:

Bond Issue B

Period Ending (A) Cash Interest Paid $560,000.0 8.0% 3/12 (B) Period Interest Expense (E) 8.5% 3/12 (C) Amort. (A) (B) (D) Unamortized Balance (E) Carrying Value $560,000 (D)
Apr. 1/21 $ 18,736 $ 541,264
Jul. 1/21 $ 11,200 $ 11,502 $ 302 18,434 541,566
Apr. 1/29 11,200 11,779 579 5,102 554,898
Jul. 1/29 11,200 11,792 592 4,510 555,490
Oct. 1/29 11,200 11,804 604 3,906 556,094
Jan. 1/30 11,200 11,817 617 3,289 556,711
Apr. 1/30 11,200 11,830 630 2,659 557,341
Jul. 1/30 11,200 11,843 643 2,016 557,984
Oct. 1/30 11,200 11,857 657 1,359 558,641
Jan. 1/31 11,200 11,871 671 688 559,312
Apr. 1/31 11,200 11,888 * 688 0 560,000
Totals $ 448,000 $ 466,736 $ 18,736

*Adjusted for rounding

Bond Issue B a. Were the bond B issued at a premium and/or discount?

multiple choice 2

Issued at discount

Issued at premium

Issued at premium & discount

b. Journalize the issuance of bond B on April 1, 2021.

c. What is the contract interest rate for the issue bond B?

d. Interest of how much is paid how often for bond B issued?

e. What is the term of bond B issue?

f. Show how bond B would appear on the balance sheet under non-current liabilities at July 31, 2029.

g. Calculate the bond B interest expense that would appear on the income statement for the year ended July 31, 2030.

h. Independent of (a) through (g), assume that bond B issues was retired on December 1, 2030, at 97. Record the entries.

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