Sikes Corporation, whose annual accounting period ends on December 31, issued the following bonds: Date of bonds: January 1, 2021 Maturity amount and date: $130,000 due in 10 years (December 31, 2030) Interest: 10 percent per year payable each December 31 Date issued: January 1, 2021 Required: 1. For each of the three independent cases that follow, provide the amounts to be reported on the January 1, 2021, financial statements immediately after the bonds are issued. TIP: See Exhibit 10.6 for an illustration distinguishing Bonds Payable from their carrying value. (Deductions should be indicated by a minus sign.) January 1, 2021-Financial statements: a. Bonds payable b. Unamortized premium (or discount) Case A (At 100) Case B (At 95) Case C (At 103)
Sikes Corporation, whose annual accounting period ends on December 31, issued the following bonds: Date of bonds: January 1, 2021 Maturity amount and date: $130,000 due in 10 years (December 31, 2030) Interest: 10 percent per year payable each December 31 Date issued: January 1, 2021 Required: 1. For each of the three independent cases that follow, provide the amounts to be reported on the January 1, 2021, financial statements immediately after the bonds are issued. TIP: See Exhibit 10.6 for an illustration distinguishing Bonds Payable from their carrying value. (Deductions should be indicated by a minus sign.) January 1, 2021-Financial statements: a. Bonds payable b. Unamortized premium (or discount) Case A (At 100) Case B (At 95) Case C (At 103)
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 6PA: Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...
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Transcribed Image Text:Sikes Corporation, whose annual accounting period ends on December 31, issued the following bonds:
Date of bonds: January 1, 2021
Maturity amount and date: $130,000 due in 10 years (December 31, 2030)
Interest: 10 percent per year payable each December 31
Date issued: January 1, 2021
Required:
1. For each of the three independent cases that follow, provide the amounts to be reported on the January 1, 2021, financial
statements immediately after the bonds are issued. TIP: See Exhibit 10.6 for an illustration distinguishing Bonds Payable from
their carrying value. (Deductions should be indicated by a minus sign.)
January 1, 2021-Financial statements:
a. Bonds payable
b. Unamortized premium (or discount)
c. Carrying value
Case A
(At 100)
Case B
(At 95)
Case C
(At 103)
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