Devon Harris Company sells 10% bonds having a maturity value of $2,000,000 for $1,855,816.00. The bonds are dated January 1, 2025, and mature January 1, 2030. Interest is payable annually on January 1. Click here to view factor tables. (a) * Your answer is incorrect. Determine the effective-interest rate. (Round present value factor to 5 decimal places, eg. 1.25124 and final answer to O decimal places, e.g. 18%.) The effective-interest rate 3.79079 %

Devon Harris Company sells 10% bonds having a maturity value of $2,000,000 for $1,855,816.00. The bonds are dated January 1, 2025, and mature January 1, 2030. Interest is payable annually on January 1. Click here to view factor tables. (a) * Your answer is incorrect. Determine the effective-interest rate. (Round present value factor to 5 decimal places, eg. 1.25124 and final answer to O decimal places, e.g. 18%.) The effective-interest rate 3.79079 %

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 1, 2021, Concord Corp. issued five-year bonds with a face value of $370.000 and a coupon interest rate of 6%, with interest payable semi-annually. Record the proceeds from the sale of the bonds if the market interest rate was 7%. See below for present value tables. (Do not use & signs or commas in your answer. Do not round intermediary calculations. Only round final answers to 2 decimal places ex: 5.25) TABLE Present Value of $1 PV (n) Periods TABLE 2 8 9 1 1 2 9T5 VO 5 6 Present Value of an Annuity of $1 PV (n) Periods 1% 1 (1 + i)" 2% 2.5% 3-5% 4% 4-5% 7% 8% 9% 10% 1.5% 3% 6% 0.99010 0.98522 0.98039 0.97561 0.97087 0.96618 0.96154 0.95694 0.95238 0.94340 0.93458 0.92593 0.91743 0.90909 0.98030 0.97066 0.96117 0.95181 0.94260 0.93351 0.92456 0.91573 0.90703 0.89000 0.87344 0.85734 0.84168 0.82645 0.97059 0.95632 0.94232 0.92860 0.91514 0.90194 0.88900 0.87630 0.86384 0.83962 0.81630 0.79383 0.77218 0.75131 0.96098 0.94218 0.92385 0.90595 0.88849 0.87144 0.85480 0.83856…
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On January 1, 2021, Baltimore Company issued $400,000 face value, 5%, 5-year bonds at 103. Baltimore uses the straight-line method for amortization. Use this information to determine the dollar value of the annual bond premium amortization. Round your answer to the nearest whole number (no cents).
Lisa Anderson Company issued $516,000 of 10%, 20-year bonds on January 1, 2025, at 102. Interest is payable semiannually on July 1 and January 1. Lisa Anderson Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.7705% Click here to view factor tables. Prepare the journal entries to record the following. (Round intermediate calculations to 6 decimal places, eg. 1.251247 and final answer to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) a. The issuance of the bonds. b. The payment of interest and related amortization on July 1, 2025. с The accrual of interest and the related amortization on December 31, 2025. Date Account Titles and Explanation Debit Credit
Paul White Company sells 10% bonds having a maturity value of $1,900,000 for $1,763,025. The bonds are dated January 1, 2025, and mature January 1, 2030. Interest is payable annually on January 1. Click here to view factor tables. Set up a schedule of interest expense and discount amortization under the straight-line method. (Round answers to 2 decimal places, e.g. 38,548.25.)
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Auerbach Inc. issued 8% bonds on October 1, 2021. The bonds have a maturity date of September 30, 2031 and a face value of $300 million. The bonds pay interest each March 31 and September 30, beginning March 31, 2022. The effective interest rate established by the market was 10%. How much cash interest does Auerbach pay on March 31, 2022? (Round your answer to 2 decimal places.) Top of Form Multiple Choice $24.00 million. $12.00 million. $30.00 million. $15.00 million.
Pearl Company sells 9% bonds having a maturity value of $1,610,000 for $1,435,895. The bonds are dated January 1, 2020, and mature January 1, 2025. Interest is payable annually on January 1. Set up a schedule of interest expense and discount amortization under the straight-line method. (Round answers to 0 decimal places, e.g. 38,548.) Year Jan. 1, 2020 Jan. 1, 2021 Jan. 1, 2022 Jan. 1, 2023 Jan. 1, 2024 Jan. 1, 2025 LA Cash Paid INI $ LA Schedule of Discount Amortization Straight-Line Method Interest Expense LLLLLL $ Discount Amortized Carryi Amount of
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Marigold Inc. issues $4,100,000 of 7% bonds due in 10 years with interest payable at year-end. The current market rate of interest for bonds of similar risk is 10%. Click here to view factor tables. What amount will Marigold receive when it issues the bonds? (For calculation purposes, use 5 decimal places as displayed in the factor table provided and final answer to O decimal places, e.g. 458,581.) Amount received by Marigold when bonds were issued $ 10822
Mary Smith Company issued $396,000 of 10%, 20-year bonds on January 1, 2025, at 102. Interest is payable semiannually on July 1 and January 1. Mary Smith Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.7705%. Click here to view factor tables. Prepare the journal entries to record the following. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) a. b. C. The issuance of the bonds. The payment of interest and related amortization on July 1, 2025. The accrual of interest and the related amortization on December 31, 2025. Date 1/1/25 + Account Titles and Explanation Debit Credit 11₁
10. Company A has $ 100,000 of 5 % bonds that mature on December 31, 2020. (Note that all interest has already been paid and the discount is fully amortized. General Journal Page Date Account Titles and Explanation Debit Credit Acti Go to (UNITED STATES)