Entries for Bonds Payable, including bond redemption
The following transactions were completed by Winklevoss Inc., whose fiscal year is the calendar year:
| Year 1 | |
| July 1. | Issued $4,630,000 of five-year, 7% callable bonds dated July 1, Year 1, at a market (effective) rate of 8%, receiving cash of $4,442,231. Interest is payable semiannually on December 31 and June 30. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $18,777 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 2 | |
| June 30. | Paid the semiannual interest on the bonds. The bond discount amortization of $18,777 is combined with the semiannual interest payment. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $18,777 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 3 | |
| June 30. | Recorded the redemption of the bonds, which were called at 98. The balance in the bond discount account is $112,661 after payment of interest and amortization of discount have been recorded. (Record the redemption only.) |
Required:
1. Journalize the entries to record the foregoing transactions. If an amount box does not require an entry, leave it blank or enter "0". When required, round your answers to the nearest dollar.
| Date | Account | Debit | Credit |
|---|---|---|---|
| Year 1 | |||
| July 1 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 2 | |||
| June 30 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 3 | |||
| June 30 | |||
2. Indicate the amount of the interest expense in (a) Year 1 and (b) Year 2.
a. Year 1 $
b. Year 2 $
3. Determine the carrying amount of the bonds
as of December 31, Year 2.
$
In: Accounting
Entries for Bonds Payable, including bond redemption
The following transactions were completed by Winklevoss Inc., whose fiscal year is the calendar year:
| Year 1 | |
| July 1. | Issued $8,610,000 of five-year, 9% callable bonds dated July 1, Year 1, at a market (effective) rate of 10%, receiving cash of $8,277,579. Interest is payable semiannually on December 31 and June 30. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $33,242 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 2 | |
| June 30. | Paid the semiannual interest on the bonds. The bond discount amortization of $33,242 is combined with the semiannual interest payment. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $33,242 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 3 | |
| June 30. | Recorded the redemption of the bonds, which were called at 98. The balance in the bond discount account is $199,453 after payment of interest and amortization of discount have been recorded. (Record the redemption only.) |
Required:
1. Journalize the entries to record the foregoing transactions. If an amount box does not require an entry, leave it blank or enter "0". When required, round your answers to the nearest dollar.
| Date | Account | Debit | Credit |
|---|---|---|---|
| Year 1 | |||
| July 1 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 2 | |||
| June 30 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 3 | |||
| June 30 | |||
2. Indicate the amount of the interest expense in (a) Year 1 and (b) Year 2.
a. Year 1 $
b. Year 2 $
3. Determine the carrying amount of the bonds
as of December 31, Year 2.
$
In: Accounting
Entries for Bonds Payable, including bond redemption
The following transactions were completed by Winklevoss Inc., whose fiscal year is the calendar year:
| Year 1 | |
| July 1. | Issued $6,350,000 of five-year, 7% callable bonds dated July 1, Year 1, at a market (effective) rate of 9%, receiving cash of $5,847,543. Interest is payable semiannually on December 31 and June 30. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $50,246 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 2 | |
| June 30. | Paid the semiannual interest on the bonds. The bond discount amortization of $50,246 is combined with the semiannual interest payment. |
| Dec. 31. | Paid the semiannual interest on the bonds. The bond discount amortization of $50,246 is combined with the semiannual interest payment. |
| Dec. 31. | Closed the interest expense account. |
| Year 3 | |
| June 30. | Recorded the redemption of the bonds, which were called at 98. The balance in the bond discount account is $301,475 after payment of interest and amortization of discount have been recorded. (Record the redemption only.) |
Required:
1. Journalize the entries to record the foregoing transactions. If an amount box does not require an entry, leave it blank or enter "0". When required, round your answers to the nearest dollar.
| Date | Account | Debit | Credit |
|---|---|---|---|
| Year 1 | |||
| July 1 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 2 | |||
| June 30 | |||
| Dec. 31-Bond | |||
| Dec. 31-Closing | |||
| Year 3 | |||
| June 30 | |||
2. Indicate the amount of the interest expense in (a) Year 1 and (b) Year 2.
a. Year 1 $
b. Year 2 $
3. Determine the carrying amount of the bonds
as of December 31, Year 2.
$
In: Accounting
Cash dividends of $71,390 were declared during the year. Cash dividends payable were $10,752 at the beginning of the year and $15,808 at the end of the year. The amount of cash for the payment of dividends during the year is a.$71,390 b.$60,638 c.$87,198 d.$66,334
In: Accounting
The future worth in year 10 of an arithmetic gradient cash flow series for years 1 through 10 is $500,000. If the gradient increase each year, G, is $3,000, determine the cash flow in year 1 at an interest rate of 10% per year.
In: Finance
The future worth in year 10 of an arithmetic gradient cash flow series for years 1 through 10 is $750,000. If the gradient increase each year, G, is $2250, determine the cash flow in year 1 at an interest rate of 6% per year.
In: Accounting
I posted this question before and the person who answered it answered wrong.........please have someone else try again
The following information applies to the questions displayed below.]
O’Brien Company manufactures and sells one product. The following information pertains to each of the company’s first three years of operations:
| Variable costs per unit: | ||
| Manufacturing: | ||
| Direct materials | $28 | |
| Direct labor | $15 | |
| Variable manufacturing overhead | $5 | |
| Variable selling and administrative | $3 | |
| Fixed costs per year: | ||
| Fixed manufacturing overhead | $580,000 | |
| Fixed selling and administrative expenses | $100,000 | |
During its first year of operations, O’Brien produced 94,000 units and sold 76,000 units. During its second year of operations, it produced 80,000 units and sold 93,000 units. In its third year, O’Brien produced 82,000 units and sold 77,000 units. The selling price of the company’s product is $73 per unit.
Assume the company uses absorption costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it assumes that the oldest units in inventory are sold first):
a. Compute the unit product cost for Year 1, Year 2, and Year 3. (Round your intermediate calculations and final answers to 2 decimal places.)
b. Prepare an income statement for Year 1, Year 2, and Year 3. (Round your intermediate calculations to 2 decimal places.)
4. Assume the company uses absorption costing and a LIFO inventory flow assumption (LIFO means last-in first-out. In other words, it assumes that the newest units in inventory are sold first):
a. Compute the unit product cost for Year 1, Year 2, and Year 3. (Round your intermediate calculations and final answers to 2 decimal places.)
b. Prepare an income statement for Year 1, Year 2, and Year 3. (Round your intermediate calculations to 2 decimal places.)
In: Accounting
Sadik Industries must install $1 million of new machinery in its Texas plant. It can obtain a bank loan for 100% of the required amount. Alternatively, a Texas investment banking firm that represents a group of investors believes that it can arrange for a lease financing plan. Assume that these facts apply:
1.The equipment falls in the MACRS 3-year class.
2. Estimated maintenance expenses are $46,000 per year.
3.The firm's tax rate is 30%.
4.If the money is borrowed, the bank loan will be at a rate of 13%,
amortized in six equal installments at the end of each year.
5.The tentative lease terms call for payments of $280,000 at the
end of each year for 3 years. The lease is a guideline lease.
6.Under the proposed lease terms, the lessee must pay for
insurance, property taxes, and maintenance.
7.Sadik must use the equipment if it is to continue in business, so
it will almost certainly want to acquire the property at the end of
the lease. If it does, then under the lease terms it can purchase
the machinery at its fair market value at Year 3. The best estimate
of this market value is $230,000, but it could be much higher or
lower under certain circumstances. If purchased at Year 3, the used
equipment would fall into the MACRS 3-year class. Sadik would
actually be able to make the purchase on the last day of the year
(i.e., slightly before Year 3), so Sadik would get to take the
first depreciation expense at Year 3 (the remaining depreciation
expenses would be at Year 4 through Year 6). On the time line,
Sadik would show the cost of the used equipment at Year 3 and its
depreciation expenses starting at Year 3.
Year 3-year MACRS
1) 33.33 %
2) 44.45 %
3) 14.81 %
4) 7.41 %
What is the net advantage of leasing? Do not round intermediate calculations. Round your answer to the nearest dollar.
In: Finance
Return on Investment, Margin, Turnover
Ready Electronics is facing stiff competition from imported goods. Its operating income margin has been declining steadily for the past several years. The company has been forced to lower prices so that it can maintain its market share. The operating results for the past 3 years are as follows:
| Year 1 | Year 2 | Year 3 | |
| Sales | $10,000,000 | $ 9,500,000 | $ 9,000,000 |
| Operating income | 1,200,000 | 1,195,000 | 945,000 |
| Average assets | 15,000,000 | 15,000,000 | 15,500,000 |
For the coming year, Ready's president plans to install a JIT purchasing and manufacturing system. She estimates that inventories will be reduced by 70% during the first year of operations, producing a 20% reduction in the average operating assets of the company, which would remain unchanged without the JIT system. She also estimates that sales and operating income will be restored to Year 1 levels because of simultaneous reductions in operating expenses and selling prices. Lower selling prices will allow Ready to expand its market share.
(Note: Round all numbers to two decimal places.)
Required:
1. Compute the ROI, margin, and turnover for Years 1, 2, and 3.
| Year 1 | Year 2 | Year 3 | |
| ROI | % | % | % |
| Margin | % | % | % |
| Turnover |
2. Conceptual Connection: Suppose that in Year 4 the sales and operating income were achieved as expected, but inventories remained at the same level as in Year 3. Compute the expected ROI, margin, and turnover.
| ROI | % | |
| Margin | % | |
| Turnover |
Why did the ROI increase over the Year 3 level?
3. Conceptual Connection: Suppose that the sales and net operating income for Year 4 remained the same as in Year 3 but inventory reductions were achieved as projected. Compute the ROI, margin, and turnover.
| ROI | % |
| Margin | % |
| Turnover |
Why did the ROI exceed the Year 3 level?
4. Conceptual Connection: Assume that all expectations for Year 4 were realized. Compute the expected ROI, margin, and turnover.
| ROI | % |
| Margin | % |
| Turnover |
Why did the ROI increase over the Year 3 level?
In: Accounting
Ready Electronics is facing stiff competition from imported goods. Its operating income margin has been declining steadily for the past several years. The company has been forced to lower prices so that it can maintain its market share. The operating results for the past 3 years are as follows:
| Year 1 | Year 2 | Year 3 | |
| Sales | $15,000,000 | $ 9,500,000 | $ 9,000,000 |
| Operating income | 1,200,000 | 1,445,000 | 945,000 |
| Average assets | 15,000,000 | 15,000,000 | 16,000,000 |
For the coming year, Ready's president plans to install a JIT purchasing and manufacturing system. She estimates that inventories will be reduced by 70% during the first year of operations, producing a 20% reduction in the average operating assets of the company, which would remain unchanged without the JIT system. She also estimates that sales and operating income will be restored to Year 1 levels because of simultaneous reductions in operating expenses and selling prices. Lower selling prices will allow Ready to expand its market share.
(Note: Round all numbers to two decimal places.)
Required:
1. Compute the ROI, margin, and turnover for Years 1, 2, and 3.
| Year 1 | Year 2 | Year 3 | |
| ROI | % | % | % |
| Margin | % | % | % |
| Turnover |
2. Conceptual Connection: Suppose that in Year 4 the sales and operating income were achieved as expected, but inventories remained at the same level as in Year 3. Compute the expected ROI, margin, and turnover.
| ROI | % | |
| Margin | % | |
| Turnover |
Why did the ROI increase over the Year 3 level?
3. Conceptual Connection: Suppose that the sales and net operating income for Year 4 remained the same as in Year 3 but inventory reductions were achieved as projected. Compute the ROI, margin, and turnover.
| ROI | % |
| Margin | % |
| Turnover |
Why did the ROI exceed the Year 3 level?
4. Conceptual Connection: Assume that all expectations for Year 4 were realized. Compute the expected ROI, margin, and turnover.
| ROI | % |
| Margin | % |
| Turnover |
Why did the ROI increase over the Year 3 level?
In: Accounting