Billys hamburgers inc issued 5 10-year bonds payable at 90

Reference no: EM13599939

Billy's Hamburgers, Inc., issued 5%, 10-year bonds payable at 90 on December 31, 2010. At December 31, 2012, Billy reported the bonds payable as follows:

Long-term debt:
Bonds payable.... $ 400,000
Less: Discount... 32,000 $368,000

Billy uses the straight-line amortization method and pays semiannual interest each June 30 and December 31.

Requirements
1. Answer the following questions about Billy's bonds payable:
a. What is the maturity value of the bonds?
b. What is the carrying amount of the bonds at December 31, 2012?
c. What is the annual cash interest payment on the bonds?
d. How much interest expense should the company record each year?

2. Record the June 30, 2013, semiannual interest payment and amortization of discount.
3. What will be the carrying amount of the bonds at December 31,2013?

Reference no: EM13599939

Questions Cloud

The long-term debt is payable in annual installments of : the general ledger of speedy ship at june 30 2012 the end of the companys fiscal year includes the following account

Make the journal entry to record uniteds expense for welchs : louis welch is general manager of united tanning salons. during 2012 welch worked for the company all year at a 6200

The wood division of fir products inc manufactures wood : the wood division of fir products inc. manufactures wood moldings and sells them externally for 165. its variable cost

There are three subparts to this question marc age 45 : there are three subparts to this question. marc age 45 sells his personal residence on may 15 2011 for 180000. he

Billys hamburgers inc issued 5 10-year bonds payable at 90 : billys hamburgers inc. issued 5 10-year bonds payable at 90 on december 31 2010. at december 31 2012 billy reported the

The can division of fruit products inc manufactures and : the can division of fruit products inc. manufactures and sells tin cans externally for 0.30 per can. its unit variable

If the market interest rate is 6 when mcu issues its bonds : on march 1 2012 mechanics credit union mcu issued 7 20-year bonds payable with maturity value of 300000. the bonds pay

Overhead rate variable 200 fixed 100 at normal capacity of : manufacturing overhead data for the production of product b by elliot company are as follows.overhead incurred for

Assume you are representing the taxpayers before the irs : harold and betty factory workers who until this year prepared their own individual tax returns purchased an investment

User Account

All Pages