On January 1, 2021, a company issues $760,000 of 6% bonds, due in ten years, with...

On January 1, 2021, a company issues $760,000 of 6% bonds, due in ten years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 5%, the bonds will issue at $819,239.

Required:
a. Fill in the blanks in the amortization schedule below: (Round your answers to the nearest dollar amount.)

Date	Cash Paid	Interest Expense	Change in Carrying Value	Carrying Value
01/01/2021
06/30/2021
12/31/2021

b. Record the bond issue on January 1, 2021, and the first two semi-annual interest payments on June 30, 2021, and December 31, 2021.

Expert Solution

ekkarill92 answered 2 years ago

On January 1, 2018, Vandenplas issues $800,000 of 8% bonds, due in ten years, with interest...

On January 1, 2018, Vandenplas issues $800,000 of 8% bonds, due in ten years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 9%, the bonds will issue at $747,968. Record the bond issue on January 1, 2018, and the first four semi-annual interest payments on June 30, 2018, December 31, 2018, June 30, 2019, and December 31, 2019.

On January 1, 2021, Splash City issues $300,000 of 7% bonds, due in 10 years, with...

On January 1, 2021, Splash City issues $300,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest rate on the issue date is 8%, the bonds will issue at $279,615. 2. Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. Record the bond issue. Date General Journal Debit Credit January 01, 2021...

On January 1, 2021, White Water issues $540,000 of 7% bonds, due in 10 years, with...

On January 1, 2021, White Water issues $540,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 6% and the bonds issued at $580,169. Using an amortization schedule, show that the bonds have a carrying value of $570,498 on December 31, 2023.

On January 1, 2021, Splash City issues $460,000 of 8% bonds, due in 15 years, with...

On January 1, 2021, Splash City issues $460,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 9% and the bonds issued at $422,536. 2. If the market interest rate drops to 6% on December 31, 2022, it will cost $542,233 to retire the bonds. Record the retirement of the

When Patey Pontoons issued 6% bonds on January 1, 2021, with a face amount of $760,000,...

When Patey Pontoons issued 6% bonds on January 1, 2021, with a face amount of $760,000, the market yield for bonds of similar risk and maturity was 11%. The bonds mature December 31, 2024 (4 years). Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds...

On January 1, 2021, Frontier World issues $39.8 million of 8% bonds, due in 15 years,...

On January 1, 2021, Frontier World issues $39.8 million of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The proceeds will be used to build a new ride that combines a roller coaster, a water ride, a dark tunnel, and the great smell of outdoor barbeque, all in one ride. 3-a. If the market rate is 9%, calculate the issue price. (FV of $1, PV of $1, FVA of $1,...

Discount-Mart issues $10 million in bonds on January 1, 2021. The bonds have a ten-year term...

Discount-Mart issues $10 million in bonds on January 1, 2021. The bonds have a ten-year term and pay interest semiannually on June 30 and December 31 each year. Below is a partial bond amortization schedule for the bonds: Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value 01/01/2021 $ 8,640,967 06/30/2021 $ 300,000 $ 345,639 $ 45,639 8,686,606 12/31/2021 300,000 347,464 47,464 8,734,070 06/30/2022 300,000 349,363 49,363 8,783,433 12/31/2022 300,000 351,337 51,337 8,834,770 What is the carrying value...

Sanders Co. issued $800,000 of 6% bonds on January 1, 2021, due on January 1, 2026,...

Sanders Co. issued $800,000 of 6% bonds on January 1, 2021, due on January 1, 2026, with interest payable each January 1 and July 1. The bonds were sold to yield 10%. If the discount were amortized by the effective-interest method, what amount of interest expense would Sanders report in 2021 related to the bond?

on january 1st, year 1, a company issues $390,000 of 7% bonds, due in 10 years,...

on january 1st, year 1, a company issues $390,000 of 7% bonds, due in 10 years, with interest payable semiannually on june 30 and December 31 each year. Assuming the market interest rate on the issue date is 6%, the bonds will issue at $419,013. I need the answers for 1/1 year 1 carrying value: 6/30/year 1: ___________ cash paid, _____________ interest expense, _________________ change in carrying value, _________________ carrying value 12/31/year 1: ___________ cash paid, _______________ interest expense, _____________...

Quatro Co. issues bonds dated January 1, 2017, with a par value of $760,000. The bonds’...

Quatro Co. issues bonds dated January 1, 2017, with a par value of $760,000. The bonds’ annual contract rate is 10%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $799,828. 1. What is the amount of the premium on these bonds at issuance? 2. How much total bond interest expense will be recognized over...

Question