Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please anwser the following, and show work When Patey Pontoons issued 6% bonds on January 1, 2021, with a face amount of $760,000, the market

please anwser the following, and show work
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
When Patey Pontoons issued 6% bonds on January 1, 2021, with a face amount of $760,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds at January 1, 2021. 2. Prepare the journal entry to record their issuance by Patey on January 1, 2021. 3. Prepare an amortization schedule that determines interest at the effective rate each period. 4. Prepare the journal entry to record interest on June 30, 2021. 5. What is the amount related to the bonds that Patey will report in its balance sheet at December 31, 2021? 6. What is the amount related to the bonds that Patey will report in its income statement for the year ended December 31, 2021? (Ignore income taxes.) 7. Prepare the appropriate journal entries at maturity on December 31, 2024. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 and 6 Reg Determine the price of the bonds at January 1, 2021. (Round final answers to the nearest whole dollar) Table values are based on: n % Amount Present Value Cash Flow Interest Principal Price of bonds entry to record their issuance by Patey on January 1, 2021. (If no entry is required for a transaction/event, select *No journal entry required" in the first account field. Round intermediate calculations and final answers to the nearest whole dollar:) View transaction list Journal entry worksheet Record the issuance of the bonds on January 1, 2021. Note: Enter debits before credits General Journal Debit Credit Date January 01, 2021 Record entry Clear entry View general journal Req 1 Req 2 Req3 Req 4 Req 5 and 6 Req 7 Prepare an amortization schedule that determines interest at the effective rate each period. (Round intermediate calculations and final answers to the nearest whole dollar.) Cash Interest Bond Interest Expense Discount Amortization Carrying Value Semiannual Interest Period-End 01/01/2021 06/30/2021 12/31/2021 06/30/2022 12/31/2022 06/30/2023 12/31/2023 06/30/2024 12/31/2024 Total to the nearest whole dollar.) View transaction list Journal entry worksheet 1 Record the interest expense on June 30, 2021. Note: Enter debits before credits Date June 30, 2021 General Journal Debit Credit Record entry Clear entry View general Journal What is the amount(s) related to the bonds that Patey will report in its balance sheet at December 31, 2021 and Income statement for the year ended December 31, 2021? (Ignore income taxes.) (Round intermediate calculations and final answers to the nearest whole dollar.) 5. December 31, 2021 book value 6. Interest expense for 2021 Journal entry worksheet Record the retirement of the bond at maturity on December 31, 2024. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2024 Record entry Clear entry View general Journal

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting for Governmental and Nonprofit Entities

Authors: Earl R. Wilson, Jacqueline L Reck, Susan C Kattelus

16th Edition

78110939, 978-0078110931

More Books

Students also viewed these Accounting questions

Question

Examine any five (5) major factors to consider when formulating

Answered: 1 week ago