On January 1, 2023, Crane Ltd. issued $2130000, 5% bonds, which mature on January 1, 2030. The bonds were issued for $2257848to yield 4%. Crane uses the effective interest method of amortizing bond premium. Interest is payable annually on December 31. AtDecember 31, 2023, the adjusted balance in the Bonds Payable account should be$2241662.$2130000.○ $2257848.O $2274034.

Crane Ltd. issued bonds for a premium because the market interest rate (4%) is lower than the coupon…

Answered: On January 1, 2023, Crane Ltd. issued…

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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Hernandez company issued $380,000, 7%, 10-year bonds on January 1, 2022, for $407,968. this price resulted in an effective-interest rate of 6% on the bonds. interest is payable annually on January 1. hernandex]z uses the effective-interest method to amortize bond premium or discount. prepare the journal entry to record the accrual interest and the premium amortization on December 31, 2022.
On January 1, 2021, ABC Inc issued for P939,000 one thousand units of its 9%, P1,000 bonds. The bonds were issued to yield 10%. The bonds are dated January 1, 2021, and mature on December 31, 2031. ABC uses the effective interest method of amortizing bond discount. How much should ABC report as unamortized bond discount in its December 31, 2021 statement of financial position?
(b) Prepare an effective-interest amortization table for the first eight interest payments for these bonds. (c) The Bonds were redeemed on January 1, 2026 (after the interest had been paid and recorded) at 102. Prepare the journal entry for the redemption of the bonds.
answer is A: how do you get to this answers?
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Carla Corporation issued $396,000 of 7% bonds on May 1, 2025. The bonds were dated January 1, 2025, and mature January 1, 2028, with interest payable July 1 and January 1. The bonds were issued at face value plus accrued interest. Prepare Carla's journal entries for (a) the May 1 issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry. (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) No. (a) (b) (c) Date May 1, 2025 Dec 31, 2025 July 1, 2025 Account Titles and Explanation Debit Credit SUPPO
Aggies Inc. issued bonds with a $450,000 face value, 8% interest rate, and a 4-year term on July 1, 2018, and received $510,000. Interest is payable semi-annually. The premium is amortized using the straight-line method. A. July 1, 2018: entry to record issuing the bonds B. Dec. 31, 2018: entry to record payment of interest to bondholders C. Dec. 31, 2018: entry to record amortization of premium Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank. A. fill in the blank 2 fill in the blank 3 fill in the blank 5 fill in the blank 6 fill in the blank 8 fill in the blank 9 B. fill in the blank 11 fill in the blank 12 fill in the blank 14 fill in the blank 15 C.
On January 1, 2021, Hobart Services Ltd. issued $200,000 of 7% bonds at 98.Bonds are due January 1, 2026, with interest payable semi-annually on July 1 andJanuary 1.Required:• Calculate the bond price & the effective interest rate for the semi-annualinterest payments• Prepare a bond amortization schedule for the life of the bond• Prepare all the journal entries relating to the bond for 2021• Prepare a classified partial balance sheet as at December 3
Marigold Corporation issued $660,000 of 6% bonds on May 1,2025 . The bonds were dated January 1,2025 , and mature January 1 , 2028 , with interest payable July 1 and January 1 . The bonds were issued at face value plus accrued interest. Prepare Marigold's journal entries for (a) the May 1 issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry.
On June 30, 2020, Ayayai Company issued $3,810,000 face value of 16%, 20-year bonds at $4,956,520, a yield of 12%. Ayayai uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Prepare journal entries (1) The issuance of the bonds on June 30, 2020. (2) The payment of interest and the amortization of the premium on December 31, 2020. (3) The payment of interest and the amortization of the premium on June 30, 2021. (4) The payment of interest and the amortization of the premium on December 31, 2021.
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