Question
In: Accounting
On January 1, 2008, Davis Corporation issued $3,000,000 of 8% bonds at 101. Interest is paid...
On January 1, 2008, Davis Corporation issued $3,000,000 of 8% bonds at 101. Interest is paid annually on December 31 of each year. The bonds mature on December 31, 2027, and the company uses the straight-line method of amortization. On January 2, 2016, Davis reacquired the bonds and recognized a loss of $91,000.
Prepare the journal entry to record the reacquisition of Davis’s bonds on January 2, 2016.
Calculate the reacquisition price of the bonds on January 2, 2016.
Solutions
ekkarill92 answered 2 years agoRelated Solutions
On January 1, 2011, Davis Corporation issued $3,900,000 of 7% bonds at 101. Interest is paid...
On January 1, 2011, Davis Corporation issued $3,900,000 of 7%
bonds at 101. Interest is paid annually on December 31 of each
year. The bonds mature on December 31, 2027, and the company uses
the straight-line method of amortization. On January 2, 2019, Davis
reacquired the bonds and recognized a loss of $88,000.
1. Calculate the reacquisition price of the bonds on
January 2, 2019. (102.7564103 is wrong)
2. Prepare the journal entry to record the reacquisition
of Davis’s bonds...
Cronos issues $3,000,000, 7.6%, 10-year bonds to yield 8% on January 1, 2016. Interest is paid...
Cronos issues $3,000,000, 7.6%, 10-year bonds to yield 8% on
January 1, 2016. Interest is paid on June 30 and Cronos issues
$3,000,000, 7.6%, 10-year bonds to yield 8% on January 1, 2016.
Interest is paid on June 30 and December 31. The proceeds from the
bonds are $2,918,468. Using effective-interest method of
amortization,
what will the carrying value of bonds be on the December 31,
2017 balance sheet?
On January 1, 2021, Winter Company issued $500,000, 5-year, 8% bonds at 97. Interest is paid...
On January 1, 2021, Winter Company issued $500,000, 5-year, 8%
bonds at 97. Interest is paid semiannually on each June 30 and
December 31. The maturity date is December 31, 2025. How much Bond
Interest Expense will the company record on each semiannual cash
interest payment date?
On January 1, 2008, Shelly Corp. issued $8,000,000 face value 20-year bonds at 101. Bond issuance...
On January 1, 2008, Shelly Corp. issued $8,000,000 face value
20-year bonds at 101. Bond issuance costs total $40,000. The bonds
pay interest semi-annually on Jan 1 and Dec 1. Shelly uses
straight-line amortization. On Jan 1, 2016, Shelly calls the entire
issue at 103 and cancels it.
Required: Prepare the journal entry for this bond redemption on Jan
1, 2016. Please show all work
8/31/y1, $3,000,000 face value bonds are issued for $2,600,000 plus accrued interest. These bonds pay interest...
8/31/y1, $3,000,000 face value bonds are issued for $2,600,000
plus accrued interest. These bonds pay interest on October 31 and
April 30. These bonds have a coupon rate of 6%, and are dated April
30, y1. The bonds are 20-year bonds, and as such mature on April
30, Y21. Please record the following, using the straight-line
approach. This company has a December 31 year end. 8/31/y1,
issuance of the bonds (include accrued interest). 10/31/y1,
interest payment. 12/31/y1, accrual of interest....
8/31/y1, $3,000,000 face value bonds are issued for $2,600,000 plus accrued interest. These bonds pay interest...
8/31/y1, $3,000,000 face value bonds are issued for $2,600,000
plus accrued interest. These bonds pay interest on October 31 and
April 30. These bonds have a coupon rate of 6%, and are dated April
30, y1. The bonds are 20-year bonds, and as such mature on April
30, Y21. Please record the following, using the straight-line
approach. This company has a December 31 year end. 8/31/y1,
issuance of the bonds (include accrued interest). 10/31/y1,
interest payment. 12/31/y1, accrual of interest....
On January 1, 2014, Robbins Company issued five-year, $500,000 face value, 8% bonds that paid interest...
On January 1, 2014, Robbins Company issued five-year, $500,000
face value, 8% bonds that paid interest every June 30th and
December 31st. The market rate of other similar bonds was 10%. On
December 31, 2017, Robbins redeemed the bonds at 102. What was the
gain or loss on redemption. Assume that Robbins uses the effective
interest method to amortize any premium or discount. (Select the
closest answer to the one you calculate):
a, $23,619 loss
b. $19,300 loss
c. $14,765...
On January 1, 2021, Gless Textiles issued $29 million of 8%, 20-year convertible bonds at 101....
On January 1, 2021, Gless Textiles issued $29 million of 8%,
20-year convertible bonds at 101. The bonds pay interest on June 30
and December 31. Each $1,000 bond is convertible into 40 shares of
Gless’s no par common stock. Bonds that are similar in all
respects, except that they are nonconvertible, currently are
selling at 99 (that is, 99% of face amount). Century Services
purchased 10% of the issue as an investment.
Required:
1. Prepare the journal entries for...
On January 1, 2018, Gless Textiles issued $19 million of 8%, 10-year convertible bonds at 101....
On January 1, 2018, Gless Textiles issued $19 million of 8%,
10-year convertible bonds at 101. The bonds pay interest on June 30
and December 31. Each $1,000 bond is convertible into 40 shares of
Gless’s no par common stock. Bonds that are similar in all
respects, except that they are nonconvertible, currently are
selling at 99 (that is, 99% of face amount). Century Services
purchased 15% of the issue as an investment.
Required: 1. Prepare the journal entries for...
Grove Corporation issued $2,400,000 of 8% bonds on October 1, 2019. The interest is to be...
Grove Corporation issued $2,400,000 of 8% bonds on October 1,
2019. The interest is to be paid twice a year on April 1 and
October 1. The bonds were sold to yield 7% effective annual
interest. Assume the proceeds at the time of issue were $2,514,672.
a. Prepare an amortization schedule for April 1 and October 1, 2020
using the effective-interest method. Round all amounts to the
nearest dollar. (5 points) b. Using the above information, record
the bond issue...
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