What should be reported as interest revenue for 2026?
Q: A firm has arranged for a lockbox system to reduce collection time of accounts receivable. Currently…
A: Given answer for 1st question as per bartleby guidelines (a) the cash conversion cycle before…
Q: Standard Cost most Category per 100 Two-Liter Bottles rect labor $1.20 rect materials 6.50 1.80…
A: The manufacturing costs comprise direct material, direct labor, and factory overhead. Total…
Q: Del Gato Clinic's cash account shows an $12,472 debit balance and its bank statement shows $13,074…
A: Bank reconciliation: It is a statement drawn up by the business to verify the cash book balance with…
Q: (P2,000 and P1,500). If the joint costs are allocated to by-products using the reversal cost method,…
A:
Q: Please help with this question
A: Issue of bonds is a Financial Liability. This is because the Company has to pay a fixed amount of…
Q: The following selected accounts and their current balances appear in the ledger of Kanpur Co. for…
A: The balance sheet represents the financial position of the company including the assets,…
Q: Waterway’s Hair Salon is considering opening a new location in French Lick, California. The cost of…
A: Formula: Annual rate of return = Annual net income / Average investment where, Average investment=…
Q: On Jan. 1, 20x1, an entity has an outstanding note payable with carrying amount of P 1,000,000. On…
A: Introduction:- Notes payable is a liability account. It is a written promissory note. As per notes…
Q: Luma, who works for Microsoft Corp and owns 10,000 shares of American Airlines borrowed the…
A: IRS has a concept of imputed interest. Imputed interest is calculated when the loan is lent at no…
Q: Inc. is a retailer. Its accountants are preparing the company's 2nd quarter master budget. The…
A: The income statement is prepared to record the revenues and expenses of the current period.
Q: Gideon Company uses the allowance method of accounting for uncollectible accounts. On May 3, the…
A: Note: Under the Direct write-off method, bad debts expense are recorded when the company is sure…
Q: A printing machine initially costs ₱158,000. It can be sold for ₱15,000 at the end of its 10-year…
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…
Q: CUIK-983 company manufactures three products from a common input in a joint processing operation.…
A: The decision of further processing of joint products is based in incremental analysis. If the…
Q: 6. Contracting company plans to update its equipment so that its trucks are replaced after five…
A: As per the concept of time value of money the worth of money changes with passage of time because…
Q: On April 1, Cyclone Company purchases a trencher for $320,000. The machine is expected to last five…
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…
Q: 00 shares at P70 per shar P72 per share. What totall as a result of selling 15,00
A:
Q: 2018 852,000 otal revenue expenses osts of goods sold elling/general experies 232,000 9,200 $402,000…
A: Formula used: Amount Increase = 2018 Amount - 2017 Amount
Q: Noora Company manufactures quality hair care product. The ingredients are combined in the mixing…
A: Cost reconciliation is a reconciliation between costs to be accounted for (that is beginning…
Q: The balance in the unearned fees account, before adjustment at the end of the year, is $316,290.…
A: Routine transactions, such as client billings and supplier invoicing, should not be recorded using…
Q: 21-Apr 22-Apr 23-Apr 24-Apr 25-Apr 25-Apr 25-Apr 26-Apr 27 Apr 28-Apr 29-Apr 30-Apr 30-Apr 30-Apr…
A:
Q: Intangible Asset & Impairment PT Cabo is operating in the cosmetics industry. A company-owned…
A: Given :- Cost of machine is $50,000,000 Useful life is 10 years Calculation of depreciation using…
Q: In the month of January beginning Peter company borrowed $ 5000 from Lios by issuing 10 % Note,…
A: Introduction: Journals: Each and every business transactions are to be recorded in journals. All the…
Q: Mattress Comfort Corporation manufactures two types of mattresses, Dreamer and Sleeper.…
A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: How come that it became P27,000? Isn't that is the non-controlling interest in net assets (90,000 x…
A: Non Controlling Interest Calculation of non controlling interest is important in part in the workout…
Q: The interest on a non-interest bearing note is equal to
A: A non-interest-bearing note is a type of debt on which the interest is not paid regularly. In the…
Q: You were assigned to audit the Receivables of STUVWXYZ Corporation for the year ending December, 31,…
A: Explanation of various points:- 1.) A post-date check shall not be reducing the balance of trade…
Q: On January 1, 2021, Chua Company purchased a piece of equipment with a list price of P6.000.000. The…
A: The amount to be debited to equipment account will be equal to present value of all payments to be…
Q: The units-of-production method of depreciation charges a varying amount of depreciation expense for…
A: Depreciation represents the reduction in the value of an asset over a useful life of the asset. It…
Q: Proton Company purchased a new equipment on a deferred payment basis. A down payment of P50,000 was…
A: Capitalization cost is the total amount spent on the asset to make the asset put to use. It includes…
Q: Exercise 3-44 (Algorithmic) Revenue Expense and Recognition Carrico Advertising Inc. performs…
A: Account Receivable: - It is the amount which is received by the company in the future for the goods…
Q: Inc. has a shoes and a shirts division. The company reported the following segmented income…
A: Total net operating income with Shirts = $0 Total net operating income without Shirts =…
Q: How much should be reclassified to Retained Earnings as a result of derecognizing the investment in…
A: Any increase or decrease in investment is an increase or decrease in revenue of the company and has…
Q: Recreate the Post-Closing Trial Balance that wou require an entry, leave it blank.
A: A trial balance is the statement of debits credits that can only be prepared in case of double-entry…
Q: Required: -Allocate costs to products on the basis of labour hours -Over head cost rate = -…
A: Company Z has two service centers and two production centers. Now production centers have output in…
Q: BuyCo, Inc., holds 20 percent of the outstanding shares of Marqueen Company and appropriately…
A: The stock that a company's investors own on the open market is referred to as outstanding shares.…
Q: The maturity date of a note receivable: Multiple Choice O Is the day of the credit sale.
A: Notes receivable represents promise to receive certain amount promised by issuer on a specific date.…
Q: An entity reported pretax accounting income of P5,000,000 for the current year. The taxable income…
A: The tax expense is calculated on the taxable income instead of accounting income. The tax expense is…
Q: a. On February 1, the company determined that $9,200 in customer accounts was uncollectible;…
A: A Journal entry is a primary entry that records the financial transactions initially. The…
Q: 4. A corporation issues $26,000,000 of 9% bonds to yield interest at the rate of 7%. (a) Was the…
A:
Q: 1. When the prevailing interest rate in the market is 8% and the stated interest rate in the bonds…
A: Accounting for bonds A bond trade on premium when market rate of interest is lower than stated…
Q: Susan, a single taxpayer, bought her home 25 years ago for $30,000. She has lived in the home…
A: Tax is a liability calculated on the income earned and paid to the government. It acts as revenue…
Q: BSBA Company produced two joint products A and B, and by-products C and D from the same raw…
A: Dear student, Since you asked multiple questions we will answer first question only as per bartleby…
Q: Explain potential misstatements - cash receipt and the description of of misstatements. The…
A: Frauds and errors with cash possible in many ways by the employees dealing with it and is a highly…
Q: During 2019, Angel Co. introduced a new line of appliances that carry a three-year warranty against…
A: Answer - A warranty liability is a liability account in which a company records the amount of the…
Q: You have been assigned to audit RUDOLPH Company. You are asked to summarize the transactions for the…
A: The loss due to sales of treasury shares at a price below the cost of treasury shares is charged to…
Q: Hassel has estimated the first batch of product will take 80 hours to complete. A 90% learning curve…
A: Solution Concept Learning curve effect is the effect of learning upon the subsequent production It…
Q: The procedures used for over-the-counter receipts are as follows: At the close of each day’s…
A: Introduction:- Internal controls are rules, regulations and procedures executed by a company to make…
Q: How much is the company's expected cash collections in the month of May?
A: Expected cash collection is the collection of cash which has been received by the company during the…
Q: Based on the Module 1 content, briefly explain what the theory of comparative advantage would…
A: Opportunity cost means the number of units of a product forgone in order to produce a unit of…
Q: ezos Co. reported the following capital structure at the beginning of the current year= ordinary…
A: EPS is calculated by taking into account the earnings available for equity shareholders. WHERE,…
INVESTMENT AT AMORTIZED COST
CASE III: On January 1, 2026, ABC purchased 9% bonds with a face amount of P4M to yield 10%. The bonds are dated January 1, 2026, 2024, mature on December 31, 2035 and pay interest annually on December 31. The entity used the interest method.
What should be reported as interest revenue for 2026?
Step by step
Solved in 2 steps with 2 images
- Refer to the information in RE13-5. Assume that on December 31, 2019, the investment in Smith Corporation bonds has a market value of 12,500. Prepare the year-end journal entry to record the unrealized gain or loss.Investment Discount Amortization Schedule On January 1, 2019, Rodgers Company purchased 200,000 face value, 10%, 3-year bonds for 190,165.35, a price that yields a 12% effective annual interest rate. The bonds pay interest semiannually on June 30 and December 31. Required: 1. Record the purchase of the bonds. 2. Prepare an investment interest income and discount amortization schedule using the effective interest method. 3. Record the receipts of interest on June 30, 2019, and June 30, 2021.Wilbury Corporation issued 1 million of 13.5% bonds for 985,071.68. The bonds are dated and issued October 1, 2019, are due September 30, 2020, and pay interest semiannually on March 31 and September 30. Assume an effective yield rate of 14%. Required: 1. Prepare a bond interest expense and discount amortization schedule using the straight-line method. 2. Prepare a bond interest expense and discount amortization schedule using the effective interest method. 3. Prepare adjusting entries for the end of the fiscal year December 31, 2019, using the: a. straight-line method of amortization b. effective interest method of amortization 4. If income before interest and income taxes of 30% in 2020 is 500,000, compute net income under each alternative. 5. Assume the company retired the bonds on June 30, 2020, at 98 plus accrued interest. Prepare the journal entries to record the bond retirement using the: a. straight line method of amortization b. effective interest method of amortization 6. Compute the companys times interest earned (pretax operating income divided by interest expense) for 2020 under each alternative.
- Volunteer Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $540,000. Interest is payable annually. The premium is amortized using the straightline method. Prepare journal entries for the following transactions. A. July 1, 2018: entry to record issuing the bonds B. June 30, 2019: entry to record payment of interest to bondholders C. June 30, 2019: entry to record amortization of premium D. June 30, 2020: entry to record payment of interest to bondholders E. June 30, 2020: entry to record amortization of premiumRefer to the information in RE13-5. Assume that on June 30, Aggie received interest on the Smith Corporation bonds. Prepare the June 30 journal entries to record the receipt of the interest. On April 30, 2019, Aggie Corporation purchased Smith Corporation 10%, 5-years bonds with a face value of 12,000 at par plus four months of accrued interest. Prepare the April 30 journal entry to record the purchase of these available-for-sale securities.INVESTMENT AT AMORTIZED COST CASE I: On July 1, 2026, ABC purchased 5,000 of the P1,000 face amount, 8% bonds to yield 10% per annum. The bonds, which mature on July 1, 2031, pay interest semiannually on January 1 and July 1. The interest method of amortization is used. What is the carrying amount of the bond investment on December 31, 2026.
- On January 1, 2026, ABC purchased 9% bonds with a face amount of P4M to yield 10%. The bonds are dated January 1, 2026, 2024, mature on December 31, 2035 and pay interest annually on December 31. The entity used the interest method. What should be reported as interest revenue for 2026?On July 1, 2019, YYY Company paid P1,198,000 of 10% 20-year bonds with a face amount of P1,000,000. Interest is paid on June 30 and December 31. The bonds were purchased to yield 8%. The effective interest method is used to recognize interest income from this long-term investment. What is the carrying amount of the investment in bonds on December 31, 2019?(C) On April 30,2020, ABC Corp. purchased bonds with a face value of P1,400,000 and interest rate of 9% to be paid annually every Dec. 31 until the end of 2024. It paid P1,360,000 plus accrued interest plus transaction fee of P10,000. What is the journal entry to record the purchase if ABC accounted it as a FA-FV-PL? Use Accrued Interest Receivable in your answer. You may use parenthetical solutions. In the google form, provide the total cash outflow relating to the acquisition. IDL On Jan. 1.2021 ARC.nurcbased bonds for then of both
- (C) On April 30,2020, ABC Corp. purchased bonds with a face value of P1,400,000 and interest rate of 9% to be paid annually every Dec. 31 until the end of 2024. It paid P1,360,000 plus accrued interest plus transaction fee of P10,000. What is the journal entry to record the purchase if ABC accounted it as a FA-FV-PL? Use Accrued Interest Receivable in your answer. You may use parenthetical solutions. In the google form, provide the total cash outflow relating to the acquisition.On April 1, 2019, Padayon Co. acquired a 5-year bond with a face value of P1,200,000 and stated interest of 10% per year payable annually on December 31. The bonds were acquired to yield 12%. The bonds are to be appropriately classified as financial asset at amortized cost.What is the carrying value of the investment as of March 31, 2020? * a. 1,116,375 b. 1,117,716 c. 1,127,104 d. 1,140,515Problem 1: An entity purchased 12% P1,000,000 face amount bonds at 105 plus accrued interest on February 1, 2019. Interest is payable semi-annual on April 1 and October 1. Bonds are dated April 1, 2018 and matures on April 1, 2023. Required: Compute for the initial cost of investment in bonds account. Problem 2: An entity purchased 12% P1,000,000 face amount bonds at 105 on February 1, 2019. Interest is payable semi-annual on April 1 and October 1. Bonds are dated April 1, 2018 and matures on April 1, 2023. Required: Compute for the initial cost of investment in bonds account. Problem 3: On January 2, 2019 an investor acquired P1,000,000 face value bonds, dated January 2, 2019 and will mature in 3 years and bear 12% interest payable annually every December 31. The bonds will yield an effective interest of 10%. Required: 1. Compute for the market value (purchase price) of the bonds. 2. Compute for the amortization of the bond discount/premium using straight-line method of amortization.…
