FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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On March 1, 2023, Quinto Mining Inc. issued a $600,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2023.
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- Pretzelmania, Incorporated, issues 7%, 10-year bonds with a face amount of $70,000 for $70,000 on January 1, 2024. Interest is paid semiannually on June 30 and December 31. Determine the financial statement effects of (1) the bond issue on January 1, 2024, and (2) the first interest payment on June 30, 2024. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the financial statement effects of the bond issue on January 1, 2024. (Amounts to Income Statement Revenues Assets II Balance Sheet Expenses Liabilitiesarrow_forwardOn January 1, 2018, Splash City issues $470,000 of 7% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 8% and the bonds issued at $423,487. Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $425,566 on December 31, 2019. (Round Interest expense to nearest whole dollar.) Date Cash Paid 01/01/18 6/30/18 12/31/18 6/30/19 12/31/19 Interest Expense Increase in Carrying Value Carrying Value Required informationarrow_forwardPharoah Company issued $380,000 of 6%, 20-year bonds on January 1, 2022, at face value. Interest is payable annually on January 1. Prepare the journal entry to record the payment of interest on January 1, 2023.arrow_forward
- Hillside issues $1,900,000 of 5%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $1,641,812. Required: 1. Prepare the January 1 journal entry to record the bonds’ issuance. 2(a) For each semiannual period, complete the table below to calculate the cash payment. 2(b) For each semiannual period, complete the table below to calculate the straight-line discount amortization. 2(c) For each semiannual period, complete the table below to calculate the bond interest expense. 3. Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life. 4. Prepare the first two years of a straight-line amortization table. 5. Prepare the journal entries to record the first two interest payments.arrow_forwardThis question asks to make jiurnak entries pkease read and answer carefullyarrow_forwardOn July 1, 2018, Volunteer Inc. issued bonds with a $500,000 face value at 108.0 and the 5-year bonds have a 10% interest rate in a market with a rate of 8%. Interest is payable annually and the effective-interest method is used for amortization. Prepare journal entries for the following transactions.arrow_forward
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