On January 1, 2021, Wildhorse Ltd. issued bonds with a maturity value of $7,500,000 when the market rate of interest was 4%. The bonds have a coupon (contractual) interest rate of 5% and mature on January 1, 2031. Interest on the bonds is payable semi- annually on July 1 and January 1 of each year. The company's year end is December 31. Click here to view the factor table. Present Value of 1 Click here to view the factor table. Present Value of an Annuity of 1 X Your answer is incorrect. Calculate the issue price of the bonds. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round final answer to 0 decimal places, e.g. 5,275.) Issue Price $ $ 5290917 Prepare a bond amortization schedule from the date of issue up to and including January 1, 2023. (Round answers to 0 decimal places, e.g. 5,275.) WILDHORSE LTD. Bond Premium Amortization Table Effective Interest Method Semi-Annual Interest Payments 5% Bonds Issued at market rate of 4% rest Payment Interest Expense Premium Amortization Bond Amortized Cost i $ $ i $ $ i FO $ $ 7500000 375000 150000 225000 7275000 375000 145500 229500 7045500 375000 140910 234090 6811410 375000 136228 238772 6572638 Prepare all of the required journal entries related to the bonds that Wildhorse Ltd. will record during 2021, including any adjusting journal entries at December 31, 2021. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1 Cash 12790917 Bonds Payable 12790917 (To record issuance of bonds.) July 1 Bonds Payable 150000 Interest Expense 225000 Cash 375000 (To record interest payment.) Dec. 31 Bonds Payable 145500 Interest Expense 229500 Interest Payable 375000 (To accrue interest expense.) What amounts would be reported as current and non-current in the liabilities section of Wildhorse Ltd's December 31, 2021, balance sheet? (Round answers to O decimal places, e.g. 5,275.) WILDHORSE LTD. Balance Sheet (Partial) December 31, 2021 Current Liabilities Interest Payable $ 12790917 Non-Current Liabilities Bonds Payable 375000 Your answer is partially correct. Record the payment of interest on January 1, 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1 Interest Payable 375000 Cash 375000 (To record interest payment.) The bonds were redeemed on January 1, 2023 (after the interest had been paid and recorded) at 102. Prepare the journal entry for the redemption of the bonds. (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1 Bonds Payable 12790917 Gain on Bond Redemption 5290917 Cash 7500000 (To record redemption of bonds.) What will be the total interest payment over the 10-year life of the bonds? What will be the total interest expense over the 10- year life of the bonds? (Round answers to 0 decimal places, e.g. 5,275.) Interest Payment $ 3750000 Interest Expense $ 5290917
