Question
Please answer accordingly to the questions, show calculations On 1/1/21, Company Co. issued 4 year bonds with a face value of $500,000. The stated (bond)
Please answer accordingly to the questions, show calculations
On 1/1/21, Company Co. issued 4 year bonds with a face value of $500,000. The stated (bond) rate is 8%, payable semiannually on 1/1 and 7/1. The market rate at the time of issuance was 10%.
a.Calculate the issue price of the bonds, using the tables. Show your calculations.
b.Prepare the journal entry for the issuance of the bonds.
Complete the amortization table below.
Date cash paid interest expense amortization carrying value
1/1/21
7/1/21
1/1/22
7/1/22
c.Prepare the journal entries for the 7/1/21 interest payment and amortization, 12/31/21 interest accrual and amortization, and 1/1/22 interest payment.
Prepare the journal entry for retirement of the bonds at maturity
Assume instead that the bonds were redeemed on 1/1/22 at 102. Prepare the journal entry. |
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Show your calculations.
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