Skysong Corp. owes $280,000 to Concord Trust. The debt is a 10-year, 12% note due December 31, 2020. Because Skysong Corp. is in financial trouble, Concord Trust agrees to extend the maturity date to December 31, 2022, reduce the principal to $225,000, and reduce the interest rate to 6%, payable annually on December 31.

(b)Prepare the journal entries on Concord Trust’s books on December 31, 2020, 2021, 2022.

On January 1, 2020, North Country Co issued 10-year, 7 percent bonds with a face value of $1 million. The market rate for bonds of this class at the time of issue was 8%. Interest is payable annually, with the first payment due on December 31, 2020. a. Compute the issue price of the bonds. b. Show the journal entry to record the issuance of the bonds on January 1. c. Show the journal entry to record the first interest payment.

2. A small business takes out a $100,000 loan on April 1, 2020. The loan interest rate is j4 = 6%. They are to repay the loan with quarterly payments of $4,000 for 5 years (first payment on July 1, 2020), followed by n quarterly payments of 5,000 for as long as necessary. Determine the total number of loan payments made and both the amount and calendar date of the smaller final payment made one quarter after the last 5,000 payment.

On November 1, 2020, France Corp. signed a three-month, zero-interest-bearing note for the purchase of $60,000 of inventory. The maturity value of the note was $60,600, based on the bank’s discount rate of 4%. The adjusting entry prepared on December 31, 2020 in connection with this note will include a:

a. debit to Note Payable for $400.

b. credit to Interest Expense for $200.

c. debit to Interest Expense for $600.

d. credit to Note Payable for $400.

Consider the following bond issued by Walmart:

coupon rate: 6.541% face value: $1,000

maturity date: July 15, 2040 semi-annual coupons

settlement date: March 8, 2020 yield

(YTM): 5.654%

most recent coupon payment date: January 15, 2020

What is the value of the bond? (Equivalently, we are calculating the “dirty price”.) Express your answer as the dollar and cents price for a bond with $1,000 face value.

Silcon Company issued $500,000 of 6%, 10-year bonds on January 1, 2020 for $431,850 to yield an effective annual rate of 8%. Interest is paid semiannually on January 1 and July 1. Instructions: (a) Prepare the journal entries to record the transactions for 2020 related to this bond issuance assuming the effective interest method of amortization is used. (b) Prepare the journal entries as of January 1, 2021 assuming the interest was paid and then the bond was redeemed at 101.

Critically discuss and recommend how your chosen company can enhance the treatments and disclosures for impairment for the year ended 30 June 2020 so that your company could provide clear disclosure about the adverse impacts on the company from the COVID19 pandemic.

Discuss how the treatments and disclosures about impairment suggested by you for the year ended 30 June 2020 meet the fundamental characteristics of financial reporting as per the Conceptual Framework?

The following are the selected account balances or total as of January 1, 2020:

Accounts receivable                                        $380,000

Merchandise Inventory   $260,000

Current Liabilities $280,000

Selected relationship for the year:

Gross profit rate                                               40%

DSO based on average                                   40 days

Inventory turnover based on COGS 8X

Current ratio                                                      3:1

Acid Test ratio                                                   2:1

The balance of accounts receivable as of December 31, 2020 is

1. $380,000
2. $390,000
3. $400,000
4. $420,000

Brief Exercise 9-7 Elbert Company classifies its selling and administrative expense budget into variable and fixed components. Variable expenses are expected to be $26,770 in the first quarter, and $5,240 increments are expected in the remaining quarters of 2020. Fixed expenses are expected to be $41,680 in each quarter. Prepare the selling and administrative expense budget by quarters and in total for 2020. ELBERT COMPANY Selling and Administrative Expense Budget Quarter 1 2 3 4 Year $ $ $ $ $ $ $ $ $ $