ACCT 211 Week 7 Chapter 10 Exercise | Accounting Assignment Help | Liberty University
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- 08 Feb 2019
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ACCT 211 Week 7 Chapter 10 Exercise | Accounting Assignment Help | Liberty University
Chapter 10 Exercises
§ Question
1
On
January 1, 2017, Boston Enterprises issues bonds that have a $1,350,000 par
value, mature in 20 years, and pay 8% interest semiannually on June 30 and
December 31. The bonds are sold at par.
1. How much interest will Boston pay (in cash) to the bondholders every
six months?
2. Prepare journal entries to record (a) the issuance of bonds on
January 1, 2017; (b) the first interest payment on June 30, 2017; and (c) the
second interest payment on December 31, 2017.
3. Prepare the journal entry for issuance assuming the bonds are issued
at (a) 97 and (b) 103.
Complete this question by entering
your answers in the tabs below.
Required
1
How
much interest will Boston pay (in cash) to the bondholders every six months?
Required
2
Prepare
journal entries to record (a) the issuance of bonds on January 1, 2017; (b) the
first interest payment on June 30, 2017; and (c) the second interest payment on
December 31, 2017.
Required
3
Prepare
the journal entry for issuance assuming the bonds are issued at (a) 97 and (b)
103.
§ Question
2
Tano
issues bonds with a par value of $84,000 on January 1, 2017. The bonds’ annual
contract rate is 9%, and interest is paid semiannually on June 30 and December
31. The bonds mature in three years. The annual market rate at the date of
issuance is 12%, and the bonds are sold for $77,807.
1. What is the amount of
the discount on these bonds at issuance?
2. How much total bond interest expense will be recognized over the life
of these bonds?
3. Prepare an amortization table using the straight-line method to amortize
the discount for these bonds.
Complete this question by entering
your answers in the tabs below.
Required
1
What
is the amount of the discount on these bonds at issuance?
Required 2
How much
total bond interest expense will be recognized over the life of these bonds?
Required
3
Prepare
an amortization table using the straight-line method to amortize the discount
for these bonds. (Round your intermediate
calculations to the nearest dollar amount.)
§ Question
3
Bringham
Company issues bonds with a par value of $550,000 on their stated issue date.
The bonds mature in 7 years and pay 6% annual interest in semiannual payments.
On the issue date, the annual market rate for the bonds is 8%. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate
factor(s) from the tables provided.)
1. What is the amount of each semiannual interest payment for these
bonds?
2. How many semiannual interest payments will be made on these bonds
over their life?
3. Use the interest rates given to select whether the bonds are issued
at par, at a discount, or at a premium.
4. Compute the price of the bonds as of their issue date.
5. Prepare the journal entry to record the bonds’ issuance.
Complete this question by entering
your answers in the tabs below.
Req 1 to 3
What
is the amount of each semiannual interest payment for these bonds?
How many semiannual interest payments will be made on these bonds over their
life?
Use the interest rates given to select whether the bonds are issued at par, at
a discount, or at a premium.
Req 4
Compute
the price of the bonds as of their issue date. (Round all table values to 4 decimal places, and use the
rounded table values in calculations. Round intermediate calculations to the
nearest dollar amount.)
Req 5
Prepare
the journal entry to record the bonds’ issuance.
(Round intermediate calculations to the nearest dollar amount.)
§ Question
4
Paulson Company issues 6%, four-year
bonds, on December 31, 2017, with a par value of $100,000 and semiannual
interest payments.
|
Semiannual Period-End |
Unamortized Discount |
Carrying Value |
||||||
|
(0) |
12/31/2017 |
|
$ |
6,733 |
|
$ |
93,267 |
|
|
(1) |
6/30/2018 |
|
|
5,891 |
|
|
94,109 |
|
|
(2) |
12/31/2018 |
|
|
5,049 |
|
|
94,951 |
|
|
|
||||||||
Use the above straight-line bond amortization table and prepare journal entries
for the following.
1.
(a) The issuance of bonds on
December 31, 2017.
2.
(b) The first interest payment on
June 30, 2018.
3.
(c) The second interest payment on
December 31, 2018.
§ Question
5
Quatro
Co. issues bonds dated January 1, 2017, with a par value of $900,000. The
bonds’ annual contract rate is 10%, and interest is paid semiannually on June
30 and December 31. The bonds mature in three years. The annual market rate at
the date of issuance is 8%, and the bonds are sold for $947,165.
1. What is the amount of the premium on these bonds at issuance?
2. How much total bond interest expense will be recognized over the life
of these bonds?
3. Prepare an amortization table for these bonds; use the straight-line
method to amortize the premium.
Complete this question by entering
your answers in the tabs below.
Required
1
What
is the amount of the premium on these bonds at issuance?
Required
2
How
much total bond interest expense will be recognized over the life of these
bonds?
Required
3
Prepare
an amortization table for these bonds; use the straight-line method to amortize
the premium. (Round your intermediate calculations
to the nearest dollar amount.)
§ Question
6
On
January 1, 2017, Boston Enterprises issues bonds that have a $1,500,000 par
value, mature in 20 years, and pay 6% interest semiannually on June 30 and
December 31. The bonds are sold at par.
1. How much interest will Boston pay (in cash) to the bondholders every
six months?
2. Prepare journal entries to record (a) the issuance of bonds on
January 1, 2017; (b) the first interest payment on June 30, 2017; and (c) the
second interest payment on December 31, 2017.
3. Prepare the journal entry for issuance assuming the bonds are issued
at (a) 96 and (b) 104.
Complete this question by entering
your answers in the tabs below.
Required
1
How
much interest will Boston pay (in cash) to the bondholders every six months?
Required
2
Prepare
journal entries to record (a) the issuance of bonds on January 1, 2017; (b) the
first interest payment on June 30, 2017; and (c) the second interest payment on
December 31, 2017.
Required
3
Prepare
the journal entry for issuance assuming the bonds are issued at (a) 96 and (b)
104.
·
Question 7
Tano
issues bonds with a par value of $90,000 on January 1, 2017. The bonds’ annual
contract rate is 8%, and interest is paid semiannually on June 30 and December
31. The bonds mature in three years. The annual market rate at the date of
issuance is 10%, and the bonds are sold for $85,431.
1. What is the amount of the discount on these bonds at issuance?
2. How much total bond interest expense will be recognized over the life
of these bonds?
3. Prepare an amortization table using the straight-line method to amortize
the discount for these bonds.
Complete this question by entering
your answers in the tabs below.
Required
1
What
is the amount of the discount on these bonds at issuance?
Required
2
How
much total bond interest expense will be recognized over the life of these
bonds?
Required
3
Prepare
an amortization table using the straight-line method to amortize the discount
for these bonds. (Round your intermediate
calculations to the nearest dollar amount.)
§ Question
8
Bringham
Company issues bonds with a par value of $670,000 on their stated issue date.
The bonds mature in 9 years and pay 10% annual interest in semiannual payments.
On the issue date, the annual market rate for the bonds is 12%. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate
factor(s) from the tables provided.)
1. What is the amount of each semiannual interest payment for these
bonds?
2. How many semiannual interest payments will be made on these bonds
over their life?
3. Use the interest rates given to select whether the bonds are issued
at par, at a discount, or at a premium.
4. Compute the price of the bonds as of their issue date.
5. Prepare the journal entry to record the bonds’ issuance.
Complete this question by entering
your answers in the tabs below.
Req
1 to 3
What
is the amount of each semiannual interest payment for these bonds?
How many semiannual interest payments will be made on these bonds over their
life?
Use the interest rates given to select whether the bonds are issued at par, at
a discount, or at a premium.
Req 4
Compute
the price of the bonds as of their issue date. (Round all table values to 4 decimal places, and use the
rounded table values in calculations. Round intermediate calculations to the
nearest dollar amount.)
Req 5
Prepare
the journal entry to record the bonds’ issuance.
(Round intermediate calculations to the nearest dollar amount.)
§ Question
9
Paulson Company issues 8%, four-year
bonds, on December 31, 2017, with a par value of $103,000 and semiannual
interest payments.
|
Semiannual Period-End |
Unamortized Discount |
Carrying Value |
||||||
|
(0) |
12/31/2017 |
|
$ |
6,793 |
|
$ |
96,207 |
|
|
(1) |
6/30/2018 |
|
|
5,944 |
|
|
97,056 |
|
|
(2) |
12/31/2018 |
|
|
5,095 |
|
|
97,905 |
|
|
|
||||||||
Use the above straight-line bond amortization table and prepare journal entries
for the following.
(a) The
issuance of bonds on December 31, 2017.
(b) The
first interest payment on June 30, 2018.
(c) The
second interest payment on December 31, 2018.
§ Question 10
Quatro
Co. issues bonds dated January 1, 2017, with a par value of $890,000. The
bonds’ annual contract rate is 12%, and interest is paid semiannually on June
30 and December 31. The bonds mature in three years. The annual market rate at
the date of issuance is 10%, and the bonds are sold for $935,160.
1. What is the amount of the premium on these bonds at issuance?
2. How much total bond interest expense will be recognized over the life
of these bonds?
3. Prepare an amortization table for these bonds; use the straight-line
method to amortize the premium.
Complete this question by entering
your answers in the tabs below.
Required
1
What
is the amount of the premium on these bonds at issuance?
Required
2
How
much total bond interest expense will be recognized over the life of these
bonds?
Required
3
Prepare
an amortization table for these bonds; use the straight-line method to amortize
the premium. (Round your intermediate calculations
to the nearest dollar amount.)
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