The founder of Frenza asks us to assist her in accounting and analysis of the corporations bonds, which have an annual contract rate of 8%. She wants to know the business and accounting implications of further debt issuances as she looks for ways to finance the growth of Frenza. The following Tableau Dashboard is provided to help us address her questions and provide recommendations for her business decisions.
Frenza Bond Amortization 88000 90oon Carrying Value Unamortized Discount $100,000 192000 940n %ood op hoovao $80,000 $ 60,000 $40,000 $20,000 January 1, Year June 30, Year 1 December 31, June 30, Year 2 December 31, June 30, Year 3 December 31, Year 1 Year 2 Year 3 "Cash & Inventory for Competing Companies Frenza Lika Nelo Market Rate for company Bonds 55000 $50,000 42000 $40,000 Buooo) $30,000 132000 18000 $20,000 $10,000 7000 Total Equity & Net Income Frenza Lika Nelo - Cash Cash Cash Net Income $100,000 $190,000 inventory $85,000 nventory nventory Total.Equity.......$400,000..........$530,990............$27.5.000... 1. What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? 2. Prepare the journal entry for issuance of the Frenza bonds on January 1, Year 1. Required 1 Required 2 What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? Amount Premium or discount? What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? Journal entry worksheet Record the issuance of the bonds on January 1, Year 1. Note: Enter debits before credits. Date General Journal Debit Credit Jan 01 Record entry Clear entry View general journal Frenza Bond Amortization 88000 90oon Carrying Value Unamortized Discount $100,000 192000 940n %ood op hoovao $80,000 $ 60,000 $40,000 $20,000 January 1, Year June 30, Year 1 December 31, June 30, Year 2 December 31, June 30, Year 3 December 31, Year 1 Year 2 Year 3 "Cash & Inventory for Competing Companies Frenza Lika Nelo Market Rate for company Bonds 55000 $50,000 42000 $40,000 Buooo) $30,000 132000 18000 $20,000 $10,000 7000 Total Equity & Net Income Frenza Lika Nelo - Cash Cash Cash Net Income $100,000 $190,000 inventory $85,000 nventory nventory Total.Equity.......$400,000..........$530,990............$27.5.000... 1. What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? 2. Prepare the journal entry for issuance of the Frenza bonds on January 1, Year 1. Required 1 Required 2 What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? Amount Premium or discount? What is the premium or discount on the Frenza bonds on the issue date of January 1, Year 1? Journal entry worksheet Record the issuance of the bonds on January 1, Year 1. Note: Enter debits before credits. Date General Journal Debit Credit Jan 01 Record entry Clear entry View general journal
