Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations. Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations. To prepare : Journal entry to record issuance of bonds payable at face value.

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Answer 1

Question

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

2.

To determine

To Journalize: Issuance of the bonds.

3.

To determine

To Journalize: Issuance of the bonds.

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Compute bond proceeds, amortizing premium by interest method, and interest expense DATA Face amount of bonds Contract rate of interest Term of bonds, years Market rate of interest Interest payment REQUIRED: a. Compute the amount of cash proceeds from the sale of the bonds. $41,000,000 11% 3 9% Semiannual b. Compute the amount of premium to be amortized for the first semiannual interest payment period, using the interest method. c. Compute the amount of premium to be amortized for the second semiannual interest payment period, using the interest method. d. Compute the amount of the bond interest expense for the first year. Using formulas and cell references from the problem data, perform the required analysis. Formulas entered in the green cells show in the orange cells. Transfer amounts to CNOWv2 for grading. a. PV of cash proceeds b. Premium amortized for the 1st interest payment period c. Premium amortized for the 2nd interest payment period d. Interest expense for the 1st year…

1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 20Y1. 2a. Journalize the entry to record the first semiannual interest payment on December 31, 20Y1, and the amortization of the bond premium, using the straight-line method.Compute the price of $42,601,480 received for the bonds by using the present value tables

Recording Bond Entries and Preparing an Amortization Schedule- Effective Interest Method, Discount, Interest Accrual Mitchell Inc. issued 200 of its 6%, $1,000 bonds on January 1 of Year 1. The bonds pay cash interest semiannually each July 1 and January 1 and were issued to yield 7%. The bonds mature in three years on December 31, and the company uses the effective interest method to amortize bond discounts or premiums. Required a. Determine the selling price of the bonds. b. Prepare an amortization schedule for the first year of the bond term. c. Prepare journal entries on the following dates. 1. January 1 of Year 1, bond issuance. 2. July 1 of Year 1, interest payment. 3. December 31 of Year 1, interest accrual. 4. January 1 of Year 2, interest payment. (No reversing entries made.)

Answer 2

Question

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

2.

To determine

To Journalize: Issuance of the bonds.

3.

To determine

To Journalize: Issuance of the bonds.

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Answer 3

Question

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

2.

To determine

To Journalize: Issuance of the bonds.

3.

To determine

To Journalize: Issuance of the bonds.

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Answer 4

Question

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

2.

To determine

To Journalize: Issuance of the bonds.

3.

To determine

To Journalize: Issuance of the bonds.

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Answer 5

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

2.

To determine

To Journalize: Issuance of the bonds.

3.

To determine

To Journalize: Issuance of the bonds.

Answer 6

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

Answer 7

Chapter 12, Problem 12.30E

1.

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.

To prepare: Journal entry to record issuance of bonds payable at face value.

Answer 8

2.

To determine

To Journalize: Issuance of the bonds.

Answer 9

2.

To determine

To Journalize: Issuance of the bonds.

Answer 10

3.

To determine

To Journalize: Issuance of the bonds.

Answer 11

3.

To determine

To Journalize: Issuance of the bonds.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 12 - Flipco signed a 10-year note payable on January 1,...Ch. 12 - Daniels's bonds payable carry a stated interest...Ch. 12 - A bond that matures in installments at regular...Ch. 12 - Prob. 4QC Ch. 12 - Nicholas Smith Fitness Gym has 700,000 of 20-year...Ch. 12 - Prob. 6QC Ch. 12 - Prob. 7QC Ch. 12 - The debt to equity ratio is calculated as a. Total...Ch. 12 - Mike Gordon wishes to have 80,000 in five years....Ch. 12 - Prob. 10BQC

Solution Summary: The author explains that bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing operations.

To Journalize: Issuance of the bonds.

To Journalize: Issuance of the bonds.

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Chapter 12 Solutions