Question
On February 1, 2020, Cotton Corp. issued eight-year, 3% bonds with a face value of $ 600,000, with interest payable semi-annually on January 31 and
On February 1, 2020, Cotton Corp. issued eight-year, 3% bonds with a face value of $ 600,000, with interest payable semi-annually on January 31 and July 31. The bonds were sold to yield 4%.The fiscal year-end of Cotton Corp. is December 31. Related information is presented in the Table below:
Present value of 1 for 8 periods at 3%.789;Present value of 1 for 8 periods at 4%.731
Present value of 1 for 16 periods at 1.5%.788;Present value of 1 for 16 periods at 2%.728
Present value of annuity for 8 periods at 3%7.020;Present value of annuity for 8 periods at 2%7.325
Present value of annuity for 8 periods at 4%7.990;Present value of annuity for 16 periods at 1.5%14.131
Present value of annuity for 16 periods at 2%13.578;
At December 31, 2020, the adjusted balance in the Bonds Payable account should be reported at the Statement of Financial Positions is:
a.
$563,035
b.
$574,907
c.
$587,133
d.
$587,583
e.
$563,406
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