Problem: Module 3 Textbook Problem 7Learning Objective: 3-7 Using the straight-line method show how bonds issued at a premium affect financial statementsThe Square Foot Grill, Inc. issued $185,000 of 10-year, 7 percent bonds on January 1, Year 1, at 102. interest is payable in cash annuallyon December 31. The straight-line method is used for amortization. Complete this question by entering your answers in the tabs below.Req AUse a financial statements model like the one shown below to demonstrate how (1) the January 1, Year 1, bond issue and (2) the December 31,Year 1, recognition of interest expense, including the amortization of the premium and the cash payment, affects the company's financialstatements. Use + for increase, for decrease, and if there is no effect, leave the cell blank. (In the Cash Flow column, indicate whether theitem is an operating activity (OA), an investing activity (IA), or a financing activity (FA) and if there is no effect, leave the cell blank. Not allcells will require entry.)EventNo.1.28.2b.Req B to EAssetsSQUARE FOOT GRILL, INC.Effect of Transactions on Financial StatementsIncome StatementBalance SheetLiabilities +Stockholders'EquityRevenueReq AExpenseNetIncomeStatement ofCash FlowReq B to E>Show less A

In order to meet the financial requirements, the business entity raises the funds by issuing the…

earning Objective: 3-7 Using the straight-line method show how bonds issued at a premium affect financial statements he Square Foot Grill, Inc. issued $185,000 of 10-year, 7 percent bonds on January 1, Year 1, at 102. interest is payable in cash annually

earning Objective: 3-7 Using the straight-line method show how bonds issued at a premium affect financial statements he Square Foot Grill, Inc. issued $185,000 of 10-year, 7 percent bonds on January 1, Year 1, at 102. interest is payable in cash annually

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter22: Corporations: Bonds

Section: Chapter Questions

Problem 9SPB

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Cornerstone Exercise 9-22 Reporting Long-Term Debt on the Balance Sheet Dennis Corp. has the following bonds: $2,000,000 in bonds that have $10,000 of unamortized discount associated with them $500,000 in bonds that have $25,000 of unamortized premium associated with them. Required: Prepare the balance sheet presentation for these two bonds.
MASTERY PROBLEM Jackson, Inc.s fiscal year ends December 31. Selected transactions for the period 20-1 through 20-8 involving bonds payable issued by Jackson are as follows: 20-1 Oct. 31 Issued 600,000 of 10-year, 7%, callable bonds dated October 31, 20-1, for 612,000. Interest is payable semiannually on October 31 and April 30. The bond indenture provides that Jackson is to pay to the trustee bank 20,000 by May 15 of each year (except the tenth year) as a sinking fund for the retirement of the bonds on call or at maturity. Dec. 31 Made the adjusting entry for interest payable and amortized two months premium on the bonds (straight-line method). 20-2 Jan. 2 Reversed the adjusting entry for interest payable and bond premium amortization. Apr. 30 Paid the semiannual interest on the bonds and amortized six months premium. May 15 Paid the sinking fund trustee 20,000. Oct. 31 Paid the semiannual interest on the bonds and amortized six months premium. Dec. 31 Made the adjusting entry for interest payable and amortized two months premium on the bonds. 31 Sinking fund earnings for the year were 900. 20-8 May 15 Paid the sinking fund trustee 20,000. Oct. 31 Paid the semiannual interest on the bonds and amortized six months premium. 31 Redeemed the bonds, which were called at 97. The balance in the bond premium account is 3,600 after the payment of interest and amortization of premium have been entered. The cash balance in the sinking fund is 200,000, which is applied to the redemption. Jackson paid the sinking fund trustee the additional cash needed to pay off the bonds. (Hint: First make the entry for payment to the sinking fund, then make the entry for redemption of the bonds.) REQUIRED 1. Enter the preceding transactions in general journal form. 2. Calculate the carrying value of the bonds as of December 31, 20-2.
Problem 4 - Bonds Payable Question Information: REQ A Bond Face Stated Effective Life PAR/PREMIUM/DISCOUNT Issuance Value Interest Interest Rate Rate A $ 100,000 6% 6% 10 years B $ 400,000 8% 6% 10 years C $ 600,000 6% 8% 5 years Insert Computations or Amortization Data analytics or Excel Data tools here: REQ B Compute the proceeds of each bond issuance A B C REQ C For Each, indicate whether the balance sheet value of the bond liability will increase, decrease or remain constant over the life of the bond A B C REQ D For Eaqch bond issuance indicate whether the interest expense recognized each period will increase decrease or remain constant over the life of the bond A B C
QUESTION 10 A $545,000 bond issue on which there is an unamortized discount of $44.000 is redeemed ior $474,000. Journalize the redemption of the bonds using the straight-line method and the chart of accounts below. Gain on Redemption of Bonds Interest Expense Interest Payable Interest Revenue Bonds Payable Cash Discount on Bonds Payable Loss on Redemption of Bonds Premiun on Bonds Payable Enter your answers into the table below. Key the account names carefully (exactly as shown above) and follow formatting instructions below. DO NOT USE A DECIMAL WITH ZEROES FOR WHOLE DOLLAR AMOUNTS AND USE COMMAS APPROPRIATELY. WHEN THE DEBIT/CREDIT DOES NOT REQUIRE AN ENTRY, LEAVE IT BLANK. Account Debit Credit THIS QUESTION WILL ALSO BE CHECKED MANUALLY (to make adjustments for typos). Click Save and Submit to saue and submit Clil Saue 47l aacars to na
Please assist with 7,8,9,10 Problem #1 Hillside issues $4,000,000, 6%, 15-year bonds dated January 1, 2023. The bonds pay interest semi-annually on June 30 and December 31. The bonds were issued at $3,456,400. Record the journal entry to issue the bonds on January 1, 2023. a. Record the journal entry to pay the semi-annual interest payment and amortize the discount on June 30, 2023. Record the journal entry to pay the semi-annual interest payment and amortize the discount on Dec. 31, 2023. On March 31, 2029, Hillside calls the bonds at 101. Record the journal entry to call the bonds. What is the total interest expense for the bonds for: One full year? The entire 15-year life of the bond? (if the bond had been held until maturity) What is the carrying value of the bonds on: December 31, 2023? December 31, 2024?
Instructions Present Value Tables Chart of Accounts Journal Final Questions Instructions Campbell Inc. produces and sells outdoor equipment. On July 1, Year 1, Campbell Inc. issued $60,400,000 of 10-year, 12% bonds at a market (effective) interest rate of 11%, receiving cash of $64,009,069. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1.* 2. Journalize the entries to record the following:* a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond premium, using the straight-line method. (Round to the nearest dollar.) b. The interest payment on June 30, Year 2, and the amortization of the bond premium, using the straight-line method. (Round to the nearest dollar.) 3. Determine the total interest expense for Year 1. 4. Will the bond proceeds always be…
Please assist with questions 7,8,9,10 Problem #2 Ellis issues $250,000, 6.5%, 5-year bonds dated January 1, 2023. The bonds pay interest semi-annually on June 30 and December 31. The bonds were issued at $255,330. Record the journal entry to issue the bonds on January 1, 2023. a. Record the journal entry to pay the semi-annual interest payment and amortize the premium on June 30, 2023. Record the journal entry to pay the semi-annual interest payment and amortize the premium on Dec. 31, 2023. On September 1, 2026, Ellis calls the bonds at 99. Record the journal entry to call the bonds. What is the total interest expense for the bonds for: One full year? The entire 5-year life of the bond? (if the bond had been held until maturity) What is the carrying value of the bonds on: December 31, 2023? December 31, 2024?
Please continue assisting with questions 4,5 6 Problem #1 Hillside issues $4,000,000, 6%, 15-year bonds dated January 1, 2023. The bonds pay interest semi-annually on June 30 and December 31. The bonds were issued at $3,456,400. Record the journal entry to issue the bonds on January 1, 2023. a. Record the journal entry to pay the semi-annual interest payment and amortize the discount on June 30, 2023. Record the journal entry to pay the semi-annual interest payment and amortize the discount on Dec. 31, 2023. On March 31, 2029, Hillside calls the bonds at 101. Record the journal entry to call the bonds. What is the total interest expense for the bonds for: One full year? The entire 15-year life of the bond? (if the bond had been held until maturity) What is the carrying value of the bonds on: December 31, 2023? December 31, 2024?
Part 1 The journal entry on the maturity date to record the retirement of bonds with a face value of $2,000,000 that were issued at a $80,000 discount includes Question content area bottom Part 1 A. a credit to Cash for $2,080,000. B. a debit to Discount on Bonds Payable for $80,000. C. a debit to Bonds Payable for $2,000,000. D. all of the above.
Question 36 On January 1, 2018, Marigold Corporation issued $4200000, 10-year, 9% bonds at 102. Interest is payable annually on January 1. The journal entry to record this transaction on January 1, 2018 is Cash 4200000 Bonds Payable 4200000 Cash 4284000 Bonds Payable 4200000 Premium on Bonds Payable 84000 Cash 4284000 Bonds Payable 4284000 Premium on Bonds Payable 84000 Cash 4200000 Bonds Payable 4284000
Brief Exercise 10-09 Oriole Company issues $325,000, 20-year, 7% bonds at 103. Prepare the journal entry to record the sale of these bonds on June 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Enter an account title enter a debit amount enter a credit amount Enter an account title enter a debit amount enter a credit amount Enter an account title enter a debit amount enter a credit amount
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