Use the following information to answer the following three questions: On July 1, 2019, Jones Corp....

Use the following information to answer the following three questions:

On July 1, 2019, Jones Corp. issued $40,000 face value, 10-year, 8% coupon bonds paying interest semiannually on June 30^th and Dec 31^st. The market (yield) rate on the date of issuance was 10%. The present value factor for an annuity is 12.462 and the present value factor of a lump sum is 0.377

1. Record the journal entry made when the bonds were issued on July 1^st, 2019?

2. Record the journal entry made to record the first interest payment on December 31^st 2019?

3. Record the journal entry made to record the retirement of the bonds at maturity?

Expert Solution

Sl No	Particulars	Dr	Cr
1	Cash	$ 35,019.20
	Discount on Bond Issue (Working 1)	$ 4,980.80
	8% Bonds Payable		$ 40,000.00

2	Interest on Bond (Working 2)	$ 1,600.00
	Cash		$ 1,600.00

3	8% Bonds Payable	$ 40,000.00
	Cash		$ 40,000.00
	Workings:-
W1	Face Value of Bond (given)		$ 40,000.00
	PV of Semi annual Interest Payments	$ 19,939.20
	($ 1600 X 12.462)
	PV of Face Value of Bond ($40,000 X .377)	$ 15,080.00	$ (35,019.20)
	Discount on Bond Issue		$ 4,980.80

W2	Face Value of Bond X Coupon Rate / 2	$ 1,600.00

ekkarill92 answered 2 years ago

Use the following information to answer the following three questions: On July 1, 2003, Jones Corp....

Use the following information to answer the following three questions: On July 1, 2003, Jones Corp. issued $100,000 face value, 10-year, 6% coupon bonds paying interest semiannually on June 30th and Dec 31st. The market (yield) rate on the date of issuance was 12%. The company’s fiscal year end is Dec. 31st. The cash received on July 1, 2003 when the issuance occurred was $65,610. 1. Which of the following journal entries were made when the bonds were issued on...

Use the following information from Key Company for the month of July to answer questions 1...

Use the following information from Key Company for the month of July to answer questions 1 through 4: July 1 Beg. Inventory 75 Units @ $25 each July 3 Purchase 348 Units @ $27 each July 8 Sale 300 Units July 15 Purchase 257 Units @ $28 each July 23 Sale 275 Units Assume that Key uses a perpetual FIFO inventory system. What is the dollar value of its ending inventory? Date Beg. Inv. Purchase Sale End. Inv. Assume that...

Use the following information from Marvel for the month of July to answer questions 1 through...

Use the following information from Marvel for the month of July to answer questions 1 through 4: July 1 Beg. Inventory 75 Units @ $25 each July 3 Purchase 348 Units @ $27 each July 8 Sale 300 Units July 15 Purchase 257 Units @ $28 each July 23 Sale 275 Units Assume that Marvel uses a perpetual FIFO inventory system. What is the dollar value of its ending inventory? Date Beg. Inv. Purchase Sale End. Inv. 7/1 7/3 7/8...

Use the following information to answer questions 22–24. On July 1, 20X0, CriCo takes out a...

Use the following information to answer questions 22–24. On July 1, 20X0, CriCo takes out a 10%, $10,000 note payable that is due on July 1, 20X1. No interest is accrued at year-end 20X0. 24. To correct this error in 20X0, you need to record just the adjusting entry that was not made because . . . a. an expense account is involved b. no error was made recording the note payable on July 1, 20X0 c. an accrual is...

Use the following information to answer the next three questions: The following information is available from...

Use the following information to answer the next three questions: The following information is available from the records of Aggies R Us, Inc. at the end of the 2017 calendar year. Assume this is Aggies’ 1st year of operation. Accounts Receivable $102,200 Notes Payable $???? Cash 70,890 Salary Expense 320,000 Building 75,000 Retained earnings ???? Advertising Expense 60,000 Accounts Payable 62,800 Dividends 12,200 Income Tax Expense 23,100 Service Revenues 460,000 Common Stock 120,000 Office Equipment 22,500 Wages Payable 15,450 Determine Aggies’ Net Income for the year ended December 31, 2017: A. $36,900 B. $80,000 C. $56,900 D. $44,700...

1. Use the following information to answer the next three questions. One year interest rates for...

1. Use the following information to answer the next three questions. One year interest rates for identical investments in Japan and Canada are 7% and 2%, respectively. The current exchange rates for the two currencies are as follows: C$1.25/$, $ .008/¥. What should be the one-year forward rate according to IRP? 2. Suppose the one-year forward rate is ¥106.5/C$. Calculate the actual forward premium/discount, assuming Japan is the home country. Round intermediate steps and your final answer four decimals. Enter...

Use this information for the following three questions. KW Steel Corp. uses the LIFO method of...

Use this information for the following three questions. KW Steel Corp. uses the LIFO method of inventory valuation. Waretown Steel, KW’s major competitor, instead uses the FIFO method. The following are excerpts from each company’s 2014 and 2013 financial statements: KW Steel Corp. Waretown Steel ($ in millions) 2014 2013 2014 2013 Balance sheet inventories 797.6 692.7 708.2 688.6 LIFO reserve 378.0 334.9 Sales 4,284.8 4,029.7 3,584.2 3,355.8 Cost of goods sold 3,427.8 3,226.5 2,724.0 2,617.5 Use this information for...

Use the following information to answer questions 1 and 2. This is the shareholders’...

Use the following information to answer questions 1 and 2. This is the shareholders’ equity of Pinnacle on Dec 31, 2016. Common share (200,000 issued and outstanding) $ 800,000 7 percent, preferred shares (20,000 authorized, 18,000 issued) 200,000 Retained earnings 650,000 Total $ 1,650,000 Notes: Preferred shares were issued on Jan 1, 2013. No dividends declared or paid since 2013 until Pinnacle declared and paid $400,000 dividends on Dec 31, 2016. Assuming preferred shares...

Required information Use the following information to answer questions [The following information applies to the questions...

Required information Use the following information to answer questions [The following information applies to the questions displayed below.] The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 31,000 $ 30,000 Work in process 9,500 18,200 Finished goods 54,000 34,000 Activities and information for May Raw materials purchases (paid with cash) 197,000 Factory payroll (paid with cash) 200,000 Factory overhead Indirect materials...

Use the following information to answer questions 5, 6 and 7. Alpha Corp. has a market...

Use the following information to answer questions 5, 6 and 7. Alpha Corp. has a market capitalization rate of 12%, an ROE of 16% and a plowback ratio of 50%. What is Alpha Corp's expected earnings growth rate? Group of answer choices 12% 6% 4% 8% Alpha Corp's P/E ratio is closest to: 12.5 2 8.3 6.25 Suppose Alpha Corp. decides to pay out 100% of its earnings. What will happen to its P/E ratio? Group of answer choices The...

Question