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In: Accounting
Shunda Corporation wholesales parts to appliance manufacturers. On January 1, Shunda issued $22,000,000 of five-year, 9%...
Shunda Corporation wholesales parts to appliance manufacturers. On January 1, Shunda issued $22,000,000 of five-year, 9% bonds at a market (effective) interest rate of 7%, receiving cash of $23,829,684. Interest is payable semiannually. Shunda’s fiscal year begins on January 1. The company uses the interest method.
a. Journalize the entries to record the following:
1. Sale of the bonds. Round amounts to the nearest dollar. For a compound transaction, if an amount box does not require an entry, leave it blank.
2. First semiannual interest payment, including amortization of premium. Round to the nearest dollar. For a compound transaction, if an amount box does not require an entry, leave it blank.
3. Second semiannual interest payment, including amortization of premium. Round to the nearest dollar. For a compound transaction, if an amount box does not require an entry, leave it blank.
b. Determine the bond interest expense for the first year. Enter amounts as positive numbers. Round amounts to the nearest dollar.
| Annual interest paid | $ |
| Less premium amortized | |
|
Interest expense for first year |
Solutions
ekkarill92 answered 2 years agoRelated Solutions
Shunda Corporation wholesales parts to appliance manufacturers. On January 1, 2016, Shunda Corporation issued $22,000,000 of...
Shunda Corporation wholesales parts to appliance manufacturers.
On January 1, 2016, Shunda Corporation issued $22,000,000 of
five-year, 9% bonds at a market (effective) interest rate of 7%,
receiving cash of $23,829,684. Interest is payable semiannually.
Shunda Corporation’s fiscal year begins on January 1. The company
uses the interest method. Required: A. Journalize the entries to
record the following transactions. Refer to the Chart of Accounts
for exact wording of account titles. 1. Sale of the bonds. 2. First
semiannual interest...
Shunda Corporation Wholesales parts to appliance manufactures. On Jan 1 year 1, Shunda Corporation issued $22,000,000...
Shunda Corporation Wholesales parts to appliance manufactures. On
Jan 1 year 1, Shunda Corporation issued $22,000,000 of 5 year, 9%
bonds at a market (effective) interest rate of 7%, receiving cash
of $23,829,684. Interest is payable semiannually. Shunda
Corporation's fiscal year begins on Jan 1. The company uses the
interest method.
A.Journalize the entries to record the following:
1) Sales of the bonds. Round amounts to the nearest dollar.
2) First semiannual interest payment, including amortization of
premium. Round to...
Daan Corporation wholesales repair products to equipment manufacturers. On April 1, 2016, Daan Corporation issued $2,600,000...
Daan Corporation wholesales repair products to equipment
manufacturers. On April 1, 2016, Daan Corporation issued $2,600,000
of 10-year, 11% bonds at a market (effective) interest rate of 8%,
receiving cash of $3,130,023. Interest is payable semiannually on
April 1 and October 1.
a. Journalize the entry to record the issuance
of bonds on April 1, 2016. For a compound transaction, if an amount
box does not require an entry, leave it blank.
fill in the blank f9226affffb1020_2
fill in the...
On January 1, 2016, Knorr Corporation issued $1,100,000 of 9%, 5-year bonds dated January 1, 2016....
On January 1, 2016, Knorr Corporation issued $1,100,000 of 9%,
5-year bonds dated January 1, 2016. The bonds pay interest annually
on December 31. The bonds were issued to yield 10%. Bond issue
costs associated with the bonds totaled $20,058.17.
Required: Prepare the journal entries to record the
following:
January 1, 2016 Sold the bonds at an effective rate of 10%
December 31, 2016 First interest payment using the effective
interest method
December 31, 2016 Amortization of bond issue costs...
On January 1, 2016, Knorr Corporation issued $1,100,000 of 9%, 5-year bonds dated January 1, 2016....
On January 1, 2016, Knorr Corporation issued $1,100,000 of 9%,
5-year bonds dated January 1, 2016. The bonds pay interest annually
on December 31. The bonds were issued to yield 10%. Bond issue
costs associated with the bonds totaled $20,058.17. Do not round
answers.
Required: Prepare the journal entries to record the following:
January 1, 2016 Sold the bonds at an effective rate of 10% December
31, 2016 First interest payment using the effective interest method
December 31, 2016 Amortization...
On january 1, 2016, Knorr Corporation issued $1,000,000 or 9%, 5-year bonds dated January 1, 2016....
On january 1, 2016, Knorr Corporation issued
$1,000,000 or 9%, 5-year bonds dated January 1, 2016. The bonds pay
interest on December 31. The bonds were issued to yield 10%. Bond
issue costs associated with the bonds totaled $18,000.
Prepare the journal entries to record the
following:
January 1, 2016: Sold the bonds at an effective
rate of 10%
December 21, 2016: First interest payment using the effective
interest method
December 31, 2016: Amortization of bond issue costs using the...
On January 1, 2012, Hess Corporation issued $200,000 of 9% 10 year bonds at 103, with...
On January 1, 2012, Hess Corporation issued $200,000 of 9% 10
year bonds at 103, with interest payable on July 1 and December 31
of each year. Hess uses straight-line amortization. On June 30,
2015, Hess retired $100,000 of these bonds at 98 plus accrued
interest. What gain or loss should Hess record as a gain or loss on
retirement of these bonds? Prepare the journal entry.
Matt Winne, Inc. issued $700,000 of 9%, five-year bonds payable on January 1, 2018. The market...
Matt Winne, Inc. issued $700,000 of 9%, five-year bonds
payable on January 1, 2018.
The market interest rate at the date of issuance was 6%, and
the bonds pay interest semiannually.
1.
How much cash did the company receive upon issuance of the
bonds payable? (Round to the nearest dollar.)
2.
Prepare an amortization table for the bond using the
effective-interest method, through the first two interest
payments. (Round to the nearest dollar.)
3.
Journalize the issuance of the bonds...
On January 1, 2018, Pharoah Corporation issued $2,400,000 of 5-year, 9% bonds at 96. The bonds...
On January 1, 2018, Pharoah Corporation issued $2,400,000 of
5-year, 9% bonds at 96. The bonds pay interest annually on January
1. By January 1, 2020, the market rate of interest for bonds of
risk similar to those of Pharoah Corporation had risen. As a
result, the market value of these bonds was $2,130,000 on January
1, 2020—below their carrying value. Joanna Pharoah, president of
the company, suggests repurchasing all of these bonds in the open
market at the $2,130,000...
January 1, 2018: Nexxon corporation issued 20 year, 9% bonds with a face value of $2,000,0000....
January 1, 2018: Nexxon corporation issued 20 year, 9% bonds
with a face value of $2,000,0000. the bonds were sold to yield 10%.
Interest is payable semi-annually on january 1 and July 1.
Effective rate amortization is to be used.
1. what is the issue price of the bonds?
2. Using EXCEL, prepare an amortization table for the entire
bond term.
3. Record the bond issuance on 1/1/18
4. assume the company prepares financial statements
semi-annually on June 30 and...
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