Question
In: Accounting
On June 1, 2008, Coltec Industry purchased $503,000, 11% bonds, with interest payable on January 1...
On June 1, 2008, Coltec Industry purchased $503,000, 11% bonds, with interest payable on January 1 and July 1, for $366,844, INCLUDING accrued interest. The bonds mature on October 1, 2017. Amortization is recorded using the straight-line method and the bonds are classified as available-for-sale. On December 31, 2011, the bonds were adjusted to their proper carrying value when their fair value was $374,897. The fair market value of the bonds on December 31, 2010 was $436,050. What is the NET INCOME or LOSS recorded on the Income Statement of Coltec Industry for 2011 solely as a result of these bonds? Note: Accrue interest and amortize premium/discount on a monthly basis. Round your answer to the nearest whole dollar. If NET INCOME results, enter your answer as a positive number. If NET LOSS results, place a minus sign '-' prior to the amount of the loss.
Solutions
ekkarill92 answered 2 hours agoRelated Solutions
On May 1, 2021, Sheffield Corp. purchased $1,530,000 of 12% bonds, interest payable on January 1...
On May 1, 2021, Sheffield Corp. purchased $1,530,000 of 12%
bonds, interest payable on January 1 and July 1, for $1,406,500
plus accrued interest. The bonds mature on January 1, 2027.
Amortization is recorded when interest is received by the
straight-line method. (Assume bonds are available for sale.)
Prepare the journal entry for May 1, 2021.
The bonds are sold on August 1, 2022 for $1,412,500 plus accrued
interest. Prepare all entries required to properly record the
sale.
On May 1, 2021, Sunland Company purchased $1,550,000 of 12% bonds, interest payable on January 1...
On May 1, 2021, Sunland Company purchased $1,550,000 of 12%
bonds, interest payable on January 1 and July 1, for $1,406,500
plus accrued interest. The bonds mature on January 1, 2027.
Amortization is recorded when interest is received by the
straight-line method. (Assume bonds are available for sale.)
Prepare the journal entry for May 1, 2021. (Credit
account titles are automatically indented when amount is entered.
Do not indent manually. If no entry is required, select "No Entry"
for the...
On May 1, 2014, Kymier Corp. purchased $1,500,000 of 12% bonds—with interest payable on January 1...
On May 1, 2014, Kymier Corp. purchased $1,500,000 of 12%
bonds—with interest payable on January 1 and July 1—for $1,406,500
plus accrued interest. The bonds mature on January 1, 2024.
Amortization is recorded when interest is received by the
straight-line method (by months and rounded to the nearest dollar).
(Assume bonds are available for sale.)
Instructions: (a) Prepare the entry for May 1, 2018.
(b) The bonds are sold on August 1, 2019 for $1,412,500 plus
accrued interest. Prepare all...
Metro Company purchased $100,000, 10%, 5-year bonds on January 1, 20x1, with interest payable on July...
Metro Company purchased $100,000, 10%,
5-year bonds on January 1, 20x1, with interest payable on July 1
and January 1. The bonds sold for $108,111, which results in an
effective interest rate of 8%. The market value on December 31,
20x1 was $105,000 and all bonds were sold for $107,500 on January
1, 20x2.
Required: Prepare journal entries on
January 1, 20x1, July 1, 20x1, December 31, 20x1 and January 1,
20x2 assuming the bond investment is classified as
(Trading...
Bonds Payable: On January 1, 2014 – ABC issued $800,000.00 of 20-year, 11% bonds for $739,814.81,...
Bonds Payable: On January 1, 2014 – ABC issued $800,000.00 of
20-year, 11% bonds for $739,814.81, yielding a market (yield) rate
of 12%. Interest is payable semiannually on June 30th and December
31.
a. Confirm the bond issue price.
b. Indicate the financial statement effects using the template
for
(1) bond issuance
(2) semiannual interest payable and discount amortization on
June 30, 2014
(3) semiannual interest payment and discount amortization on
December 31, 2014.
Sunland, Inc. had outstanding $5,460,000 of 11% bonds (interest payable July 31 and January 31) due...
Sunland, Inc. had outstanding $5,460,000 of 11% bonds (interest
payable July 31 and January 31) due in 10 years. On July 1, it
issued $9,750,000 of 10%, 15-year bonds (interest payable July 1
and January 1) at 97. A portion of the proceeds was used to call
the 11% bonds (with unamortized discount of $109,200) at 102 on
August 1. Prepare the journal entries necessary to record issue of
the new bonds and the refunding of the bonds.
Culver, Inc. had outstanding $5,460,000 of 11% bonds (interest payable July 31 and January 31) due...
Culver, Inc. had outstanding $5,460,000 of 11% bonds (interest
payable July 31 and January 31) due in 10 years. On July 1, it
issued $9,750,000 of 10%, 15-year bonds (interest payable July 1
and January 1) at 97. A portion of the proceeds was used to call
the 11% bonds (with unamortized discount of $109,200) at 102 on
August 1.
Prepare the journal entries necessary to record issue of the new
bonds and the refunding of the bonds. (Round answers...
Avadi Ltd. purchased $200,000 face value 7% bonds on June 1, 2019. Interest on the bonds...
Avadi Ltd. purchased $200,000 face value 7% bonds on June 1,
2019. Interest on the bonds will be paid semi-annually on May 31st
and November 30th. The yield rate at the time of purchase was 5%.
The bonds will mature in five years from the date of purchase.
Assume Avadi Ltd. prepares financial statements in accordance with
IFRS and uses the amortized cost model. Required: 1. Record the
entry for the purchase of the bond.
2. Record the entry as...
On January 1 of this year, Olive Corporation issued bonds. Interest is payable once a year...
On January 1 of this year, Olive Corporation issued bonds.
Interest is payable once a year on December 31. The bonds mature at
the end of four years. Olive uses the effective-interest
amortization method. The partially completed amortization schedule
below pertains to the bonds:
Date
Cash
Interest
Amortization
Balance
January 1, Year
1
$
46,831
End of Year 1
$2,162
$
1,967
$
195
46,636
End of Year 2
?
?
?
46,433
End of Year 3
?
?
212...
On January 1 of this year, Olive Corporation issued bonds. Interest is payable once a year...
On January 1 of this year, Olive Corporation issued bonds.
Interest is payable once a year on December 31. The bonds mature at
the end of four years. Olive uses the effective-interest
amortization method. The partially completed amortization schedule
below pertains to the bonds:
Date
Cash
Interest
Amortization
Balance
January 1, Year 1
$
46,831
End of Year 1
$
2,162
$
1,967
$
195
46,636
End of Year 2
?
?
?
46,433
End of Year 3
?
?...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Investigation B, The Braun Electroscope The Braun electroscope consists of a metal disc at the...
- Direct Labor Variances The following data relate to labor cost for production of 7,200 cellular telephones:...
- **C++ only, standard library. We are supposed to create a tower of hanoi program and do...
- The pKa of the α-carboxyl group of phenylalanine is 1.83, and the pKa of its α-amino...
- On June 1, 2008, Coltec Industry purchased $503,000, 11% bonds, with interest payable on January 1...
- What code would I add to the following program to have it print out the runtime...
- How do you think eMarketing should fit into the overall marketing picture? And How do some...
ADVERTISEMENT