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Please help with these questions. Answers are bolded. Please explain how to get these answers. Spice Company issued S200,000 of 10 percent first mortgage bonds
Please help with these questions. Answers are bolded. Please explain how to get these answers.
Spice Company issued S200,000 of 10 percent first mortgage bonds on January l, 20X4, at 105. The bonds mature in 10 years and pay interest semiannually on January I and July l. Pumpkin Corporation purchased S 140,000 of Spice's bonds from the original purchaser on December 3 1, 20X8, for S 125,000. Pumpkin owns 75 percent of Spice's voting common stock. Spice's partial bond amortization schedule is as follows: PMT # 2 3 4 5 6 7 8 9 10 11 12 1/1/20X4 7/1/20X4 1/1/20X5 7/1/20X5 1/1/20X6 7/1/20X6 1/1/20X7 7/1/20X7 1/1/20X8 7/1/20X8 1/1/20X9 7/1/20X9 1/1/20xo S PMT 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 Expense 9.605_29 9.587_09 9.568_04 9.548_12 9.527_28 9.505_48 9,482.68 Amott of Discount (Premium) (315.04) (329.57) (344 _ 77) (360.67) (37731) (394_71) (412.91) (43196) (451.88) (472.72) (494.52) (51732) Premium (Discount) 10,000.00 9768496 9,355.38 9701061 8,649.94 8,272.63 7,877.92 77465.01 7,033.05 6>81.18 67108.46 5.61394 5,096.62 Payable 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 CV of 210,000.00 209,684.96 207.877_92 207.465_01 207,033.05 206,581.18 206,108.46 205,613.94 205,096.62 29) Based on the information given above, what amount of interest expense will be eliminated in the preparation of the December 31, 20X9 consolidated financial statements? A) S13,292 B) S18,988 C) S16,296 D) S9,483
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