Hi i need analysis on textbook sollution On January 1, 2017, AJ Corporation purchased bonds with...

Hi i need analysis on textbook sollution On January 1, 2017, AJ Corporation purchased bonds with a face value of $300,000 for $308,373.53. The bonds are due June 30, 2020, carry a 13% stated interest rate, and were purchased to yield 12%. Interest is payable semiannually on June 30 and December 31. On March 31, 2018, in contemplation of a major acquisition, the company sold one-half the bonds for $159,500 including accrued interest; the remainder were held until maturity. (Analyze the specific outcomes and write an analysis directed toward the team at AJ Corporation describing what the numbers mean and how they relate to the business.)

Solutions

Expert Solution

ekkarill92 answered 9 months ago

Next > < Previous

Related Solutions

On January 1, 2017, AJ Corporation purchased bonds with a face value of $300,000 for $308,373.53....

On January 1, 2017, AJ Corporation purchased bonds with a face value of $300,000 for $308,373.53. The bonds are due June 30, 2020, carry a 13% stated interest rate, and were purchased to yield 12%. Interest is payable semiannually on June 30 and December 31. On March 31, 2018, in contemplation of a major acquisition, the company sold one-half the bonds for $159,500 including accrued interest; the remainder were held until maturity. Prepare an investment interest income and bond premium...

On January 1, 2017, AJ Corporation purchased bonds with a face value of $300,000 for $308,373.53....

Hi , I need with this question. A delivery truck was acquired on January 1, 2017,...

Hi , I need with this question. A delivery truck was acquired on January 1, 2017, at a cost of $65,000. The delivery truck was originally estimated to have a residual value of $5,000 and an estimated life of five years. The truck is expected to be driven a total of 200,000 kilometers during its life, distributed as: Year Number of Components 37,000 42,000 45,000 40,000 36,000 2017 2018 2019 2020 2021 Using the straight-line, units-of-production, and double-diminishing balance methods,...

On January 1, 2017, Shirley Corporation puchased 10% bonds dated January 1, 2017, with a face...

On January 1, 2017, Shirley Corporation puchased 10% bonds dated January 1, 2017, with a face amount of $10 million. The bonds mature in 10 years. For bonds of similiar risk and maturity, the market yield is 12%. Interest is paid semiannually on June 30 and December 31. 1. record journal entry to record the bond purchase by Shirley on January 1, 2017 2. prepare journal entry to record interest on June 30, 2017, using the effective interest method. 3....

On January 1, Year 1, Gibson Corporation purchased bonds issued by Williamson Company. These bonds were...

On January 1, Year 1, Gibson Corporation purchased bonds issued by Williamson Company. These bonds were classified as held-to-maturity securities. The face value of these bonds is $200,000, pay 8% interest, and were purchased to yield 6%. The bonds mature in 10 years and pay interest on an annual basis. If Gibson Corporation paid $229,440 for these bonds, how much interest revenue should it report on the bonds at December 31, Year 1? Assume that Gibson used the effective interest...

Rama Corporation issued $600,000 of 8% term bonds on January 1, 2017, due on January 1,...

Rama Corporation issued $600,000 of 8% term bonds on January 1, 2017, due on January 1, 2022, with interest payable each July 1 and January 1. Investors require an effective-interest rate of 10%. Prepare the journal entry at the date of the bond issuance (show the calculation)? Prepare a schedule of interest expense and bond amortization from 1/1/2017 to 1/1/2020? Prepare the journal entry to record the interest payment and the amortization for July 1, 2018. Prepare the journal entry...

On January 1, 2018, Ras Alhd Corporation purchased 12% bonds dated January 1, 2018, with a...

On January 1, 2018, Ras Alhd Corporation purchased 12% bonds dated January 1, 2018, with a principal amount of OMR 120,000. The bonds mature in 2028 (10 years). For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. What is the price of the bonds at January 1, 2018 Select one: a. OMR 120,000 b. OMR 138,694 c. OMR 108,000 d. OMR 101,306

On January 1, 2018, Shirley Corporation purchased 12% bonds dated January 1, 2018, with a face...

On January 1, 2018, Shirley Corporation purchased 12% bonds dated January 1, 2018, with a face amount of $21 million. The bonds mature in 2027 (10 years). For bonds of similar risk and maturity, the market yield is 16%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Determine the price of...

On January 1, 2017, Pronghorn Company purchased 10% bonds having a maturity value of $380,000, for...

On January 1, 2017, Pronghorn Company purchased 10% bonds having a maturity value of $380,000, for $410,343.38. The bonds provide the bondholders with a 8% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Pronghorn Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of the bond purchase. Prepare a bond amortization...

Alpha company purchased a bond investment on January 1, 2017. The bonds have a par of $10,000,...

Alpha company purchased a bond investment on January 1, 2017. The bonds have a par of $10,000, pay interest at a 5% annual rate and have 5 years until maturity. What is the total Interest Income that will be reported over the life of the bond investment if the bonds were purchased at 103 and Alpha uses the straight line amortization method?

Subjects