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businessaccountingaccounting questions and answersRequired Information Problem 10-4A Straight-Line: Amortization Of Bond Discount LO P2 The Following ...

Question: Required Information Problem 10-4A Straight-Line: Amortization Of Bond Discount LO P2 The Following Information Applies To The Questions Displayed Below.) Legacy Issues $560,000 Of 9.0%, Four-year Bonds Dated January 1, 2019, That Pay Interest Semiannually On June 30 And December 31. They Are Issued At $507,831 When The Market Rate Is 12% Problem 10-4A ...

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Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 The following information applies to th

Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 [The following information applies to t

Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 [The following information applies to t

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Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 The following information applies to the questions displayed below.) Legacy issues $560,000 of 9.0%, four-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. They are issued at $507,831 when the market rate is 12% Problem 10-4A Part 2 2. Determine the total bond interest expense to be recognized over the bonds' life Total bond interest expense over life of bonds: Amount repaid payments of $ 19,380,000 Par value at maturity Total repaid Less amount borrowed Total bond interest expense 57.000.000 57,000,000 50.805.000 6.195.000 $ Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 [The following information applies to the questions displayed below) Legacy issues $560,000 of 9.0%, four-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. They are issued at $507,831 when the market rate is 12% Problem 10-4A Part 3 3. Prepare a straight-line amortization table for the bonds' first two years. Unamortized Discount Carrying Value Semiannual Period End 01/01/2019 06/30/2019 12/31/2019 06/30/2020 12/31/2020 Required information Problem 10-4A Straight-Line: Amortization of bond discount LO P2 [The following information applies to the questions displayed below) Legacy issues $560,000 of 9.0%, four-year bonds dated January 1 2019, that pay interest semiannually on June 30 and December 31. They are issued at $507,831 when the market rate is 12% Problem 10-4A Part 4 4. Prepare the journal entries to record the first two interest

Answer 1

Interest semi annual	6%
Face value	560000
Coupon Payment	25200
number of payments	Date	Carrying value at beginning	Coupon Payment(a)	Interest Expense(b)	Discount Amortization(b-c)	closing carrying value
0	13-Dec-19	507831	-	-	-	507831
1	30-Jun-20	507831	25200	30470	5270	513101
2	31-Dec-20	513101	25200	30786	5586	518687
3	30-Jun-21	518687	25200	31121	5921	524608
4	31-Dec-21	524608	25200	31476	6276	530885
5	30-Jun-22	530885	25200	31853	6653	537538
6	31-Dec-22	537538	25200	32252	7052	544590
7	30-Jun-23	544590	25200	32675	7475	552065
8	31-Dec-23	552065	25200	33124	7924	559989
Notes
interest expense = 6% x carrying value at beginning
closing carrying value = closing value at beginning +discount amortization
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