Question
In: Accounting
1. Determine the present value of five-year bonds payable with face value of $91,000 and stated...
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1. |
Determine the present value of five-year bonds payable with face value of $91,000 and stated interest rate of 14%, paid semiannually. The market rate of interest is 14% at issuance. |
|
2. |
Same bonds payable as in Requirement 1, but the market interest rate is 16%. |
|
3. |
Same bonds payable as in Requirement 1, but the market interest rate is 10%. |
Solutions
ekkarill92 answered 2 years agoRelated Solutions
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...
Determining the present value of bonds payable Interest rates determine the present value of future amounts
Question: Determining the present value of bonds payable
Interest rates determine the present value of future amounts. (Round to the nearest
dollar.)
Requirements
1. Determine the present value of 10-year bonds payable with face value of $86,000
and stated interest rate of 14%, paid semiannually. The market rate of interest is
14% at issuance.
2. Same bonds payable as in Requirement 1, but the market interest rate is 16%.
3. Same bonds payable as in Requirement 1, but the...
Present Value of Bonds Payable; Premium Moss Co. issued $180,000 of five-year, 11% bonds, with interest...
Present Value of Bonds Payable; Premium Moss Co. issued $180,000
of five-year, 11% bonds, with interest payable semiannually, at a
market (effective) interest rate of 10%. Determine the present
value of the bonds payable, using the present value tables in
Exhibit 5 and Exhibit 7. Round to the nearest dollar. $
Present Value of Bonds Payable; Premium Moss Co. issued $610,000 of five-year, 13% bonds, with interest...
Present Value of Bonds Payable; Premium
Moss Co. issued $610,000 of five-year, 13% bonds, with interest
payable semiannually, at a market (effective) interest rate of
11%.
Determine the present value of the bonds payable, using the
present value tables in Exhibit 5 and Exhibit 7. Round to the
nearest dollar.
$
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.
$
On January 1, Year 1, Victor Company issued bonds with a $650,000 face value, a stated...
On January 1, Year 1, Victor Company issued bonds with a
$650,000 face value, a stated rate of interest of 6%, and a 5-year
term to maturity. The bonds sold at 95. Interest is payable in cash
on December 31 of each year. Victor uses the straight-line method
to amortize bond discounts and premiums. What is the carrying value
of the bond liability at December 31, Year 3?
On January 1, Year 1, Victor Company issued bonds with a $750,000 face value, a stated...
On January 1, Year 1, Victor Company issued bonds with a
$750,000 face value, a stated rate of interest of 5%, and a 5-year
term to maturity. The bonds sold at 96. Interest is payable in cash
on December 31 of each year. Victor uses the straight-line method
to amortize bond discounts and premiums. What is the carrying value
of the bond liability at December 31, Year 3?
On January 1, Year 1, Victor Company issued bonds with a $750,000 face value, a stated...
On January 1, Year 1, Victor Company issued bonds with a
$750,000 face value, a stated rate of interest of 5%, and a 5-year
term to maturity. The bonds sold at 96. Interest is payable in cash
on December 31 of each year. Victor uses the straight-line method
to amortize bond discounts and premiums. What is the amount of
interest expense appearing on the income statement for the year
ending December 31, Year 3?
On January 1, Year 1, Victor Company issued bonds with a $650,000 face value, a stated...
On January 1, Year 1, Victor Company issued bonds with a
$650,000 face value, a stated rate of interest of 6%, and a 5-year
term to maturity. The bonds sold at 95. Interest is payable in cash
on December 31 of each year. Victor uses the straight-line method
to amortize bond discounts and premiums. What is the amount of
interest expense appearing on the income statement for the year
ending December 31, Year 3?
On January 1, Year 1, Mudpond Company issued bonds with a $400,000 face value, a stated...
On January 1, Year 1, Mudpond Company issued bonds with a
$400,000 face value, a stated rate of interest of 5%, and a 10-year
term to maturity. The bonds sold for $432,444. Mudpond uses the
effective interest method to amortize bond discounts and premiums.
The market rate of interest on the date of issuance was 4%.
Interest is paid annually on December 31.
REQUIRED:
Complete the amortization schedule below:
Cash Payment
Interest Expense
Amortization
Carrying Value
1/1/Year 1
12/31/Year 1...
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