On January 1, 2024, Tennessee Harvester Corporation issued debenture bonds that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below: Payment Cash Payment Effective Interest Increase in Balance Outstanding Balance 6,221,759 1 356,000 373,306 17,306 6,239,065 2 356,000 374,344 18,344 6,257,409 3 356,000 375,445 19,445 6,276,854 4 356,000 376,611 20,611 6,297,465 5 356,000 377,848 21,848 6,319,313 6 356,000 379,159 23,159 6,342,472 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 38 356,000 505,452 149,452 8,573,656 39 356,000 514,419 158,419 8,732,075 40 356,000 523,925 167,925 8,900,000 Required: What is the face amount of the bonds? What is the initial selling price of the bonds? What is the term to maturity in years? Interest is determined by what approach? What is the stated annual interest rate? What is the effective annual interest rate? What is the total cash interest paid over the term to maturity? What is the total effective interest expense recorded over the term to maturity

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Bad Debts

At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.  

Accounts Receivable

The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.