On January 01, 2017, ASU Corporation issued $100,000 face-value bonds, with 6% interest payable at the...

On January 01, 2017, ASU Corporation issued $100,000 face-value bonds, with 6% interest payable at the end of year, that are due in 3 years. The current market interest rate for the bonds of the same rating is 8%. (1) Using the tables given, compute the selling price of the bonds as of January 01, 2017.

(2) Complete the following amortization schedule using effective-interest method.

(3) Prepare journal entries on each of the following dates.

a) 01/01/2017

b) 12/31/2017

c) 12/31/2018

d) 12/31/2019

Solutions

Expert Solution

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

On January 01, 2017, ASU Corporation issued $100,000 face-value bonds, with 7% interest payable at the...

On January 01, 2017, ASU Corporation issued $100,000 face-value bonds, with 7% interest payable at the end of year, that are due in 5 years. The current market interest rate for the bonds of the same rating is 5%. Using the tables given, compute the selling price of the bonds as of January 01, 2017. Complete the following amortization table using effective-interest method. Prepare journal entries on each of the following dates. 01/01/2017 12/31/2017 12/31/2021

On January 1, 2017, Crawford Corporation issued five-year, 4% bonds payable with a face value of...

On January 1, 2017, Crawford Corporation issued five-year, 4% bonds payable with a face value of $2,600,000. The bonds were issued at 88 and pay interest on January 1 and July 1. Crawford amortizes bond discounts using the straight-line method. On December 31, 2019, Crawford retired the bonds early by purchasing them at a market price of 94. The company's fiscal year ends on December 31. 1. Journalize the issuance of the bonds on January 1, 2017. 2. Record the...

On January 1, 2013, Queen Corporation issued 12-year, 6% bonds payable with a face value of...

On January 1, 2013, Queen Corporation issued 12-year, 6% bonds payable with a face value of $10 million. The bonds require semi-annual coupon payments on June 30 and December 31 every year. Fill in the blanks below to show the amounts and timing for contractual future cash flows for these bonds. Lump-sum payment due at maturity (FV) = _________ Amount of each semi-annual coupon payment (pmt) = ________ Number of compounding periods from issue date to maturity = _________ Total...

On January 1, 20172017, CameronCameron Corporation issued fivefive-year, 88% bonds payable with a face value of...

On January 1, 20172017, CameronCameron Corporation issued fivefive-year, 88% bonds payable with a face value of $ 2 comma 700 comma 000$2,700,000. The bonds were issued at 9090 and pay interest on January 1 and July 1. CameronCameron amortizes bond discounts using the straight-line method. On December 31, 20192019, CameronCameron retired the bonds early by purchasing them at a market price of 9292. The company's fiscal year ends on December 31.Read the requirements LOADING... . Requirement 1. Journalize the issuance...

Question: Bonds Payable On January 1, 2019, ABC Company issued bonds with a face value of...

Question: Bonds Payable On January 1, 2019, ABC Company issued bonds with a face value of $1,000 and a coupon rate of 8 percent. The bonds mature in 2 years and pay interest on June 30 and December 31 each year. The market rate is 12% annually. The present value of $1 table and the present value of annuity of $1 table are provided on the next page.Round your final answers to the nearest whole dollar. (1) What is the...

Kelly Industries issued 11% bonds, dated January 1, with a face value of $100,000 on January...

Kelly Industries issued 11% bonds, dated January 1, with a face value of $100,000 on January 1, 2018. The bonds mature in 2028 (10 years). Interest is paid semiannually on June 30 and December 31. For bonds of similar risk and maturity the market yield is 12%. What was the issue price of the bonds?

On January 1st, 2016, Professors Credit Union(PCU) issued 6%, 20-year bonds payable with face value of...

On January 1st, 2016, Professors Credit Union(PCU) issued 6%, 20-year bonds payable with face value of 900,000. The bonds pay interest on June 30th and December 31st. The issue price of the bonds is 105. a. Issuance of bonds on January 1st, 2016 b. Payment of interest and amortization on June 30th, 2016 c. Payment of interest and amortization on December 31st, 2016 d. Retirement of bond at maturity on December 31st, 2035

On January 1, 2018, Professor's Credit Union (PCU) issued 6%, 20-year bonds payable with face value...

On January 1, 2018, Professor's Credit Union (PCU) issued 6%, 20-year bonds payable with face value of $700,000. The bonds pay interest on June 30 and December 31. Requirement 1: If the market interest rate is 5% when PCU issues it's bonds, will the bonds be priced at face value at a premium, or at a discount? Explain.The 6% bonds issued when the market interest rate is 5% will be priced at _______. They are _______ in this market, so...

January 1, 2018: Xenith Corporation issued 15 year, 6% bonds with a face value of $1,625,000....

January 1, 2018: Xenith Corporation issued 15 year, 6% bonds with a face value of $1,625,000. The bonds were sold to yield 7%. 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? (Show financial calculator inputs) 2. Using Excel, prepare an amortization table for the entire bond term. (Table should be properly labeled and neatly presented. Amounts should have commas and be rounded...

Present Value of Bonds Payable; Premium Moss Co. issued $100,000 of five-year, 11% bonds with interest...

Present Value of Bonds Payable; Premium Moss Co. issued $100,000 of five-year, 11% bonds with interest payable semiannually, at a market (effective) interest rate of 8%. Determine the present value of the bonds payable, using the present value tables in Exhibit 8 and Exhibit 10. Note: Round to the nearest dollar. $

Subjects