Question
Problem 9. Effective-Interest Rate Method: Bonds Issued at Premium & Discount (4.2 content area) 9.1 On Jan. 1, 2018, UMPI, Inc. issued $600,000, of 10%
Problem 9. Effective-Interest Rate Method: Bonds Issued at Premium & Discount (4.2 content area)
9.1 On Jan. 1, 2018, UMPI, Inc. issued $600,000, of 10% bonds, due in 5 years. The bonds pay interest semi-annually on July 1 and January 1. The bonds effective yield 8%. UMPI uses the effective-interest method (see PV Tables). Prepare UMPIs journal entries for a thru c.
- The January 1 issuance
- The July 1 interest payment
- The December 31 adjusting journal entry
- Prepare a full Bond Amortization Schedule
9.2 On Jan. 1, 2018, UMPI, Inc. issued $600,000 of 10% bonds, due in 5 years. The bonds pay interest semi-annually on July 1 and January 1. The bonds effective yield 12%. UMPI uses the effective-interest method (see PV Tables). Prepare UMPIs journal entries for a thru c.
- The January 1 issuance
- The July 1 interest payment
- The December 31 adjusting journal entry
- Prepare a full Bond Amortization Schedule
Present Value of a Single Sum TABLE 2 Present Value of $1 PV=(1+i)$1 Present Value of an Ordinary Annuity (interest) of 1 Present Value of an Ordinary Annuity of $1 Step by Step Solution
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Financial Accounting For School Administrators Tools For School
Authors: Ronald E. Everett, Donald R. Johnson, Bernard W. Madden
3rd Edition
1610487710, 978-1610487719
