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Need help. Thank you in advance Problem1 On December 31 , 2010, Bible Distributing Company issues 8%, 10-year convertible bonds with a maturity value of

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Problem1 On December 31 , 2010, Bible Distributing Company issues 8%, 10-year convertible bonds with a maturity value of $700,000. The semiannual interest dates are June 30 and December 31, The market interest rate is 9%, and the issue price of the bonds is 94. Bible Distributing Company amortizes bond premium and discount by the effective-interest method. Required Prepare an effective-interest-method amortization table for the first four semiannual interest periods. [see page 662 or 663 ] Journalize the following transactions: 1. 2. Issuance of the bonds on December 31, 2010. Credit Convertible Bonds Payable. Payment on interest on June 30, 2011. Payment of interest on December 31, 2011. Retirement of bonds with maturity value of $100,000 on December 31, 2012. Bible Distributing Company purchases the bonds at 98 in the open market a. b. c. d. Prepare a balance sheet presentation of the bonds payable that are outstanding at December 31, 2012. 3. [see page 655 to 656 ] NOTE: (1) The 4 % and496 present value factors are not in your text. need these to work the problem. However, you will not (2) You do not need to use present value techniques to compute the selling price of the bonds (i.e. the original carrying value). I gave you the percentage of par that the bonds were issued at, in the problem. See the bottom paragraph on page 646 on how to compute the selling price. (3) See page 661 to 663 on how to amortize the discount or premium

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