Determine the issue price of the bonds

Assignment Help Financial Accounting

Reference no: EM131216859

On June 1, 2014, Mink Company issued $12,000,000 of 10 percent bonds to yield 12 percent. Interest is payable semiannually on May 31 and November 30. The bonds mature in 15 years. Mink Company is a calendar-year corporation.

(1) Determine the issue price of the bonds. Show computations.

(2) Prepare an amortization table through the first two interest periods using the effective-interest method.

(3) Prepare the journal entries to record bond-related transactions as of the following dates:

(a) June 1, 2014

(b) November 30, 2014

(d) May 31, 2015

Reference no: EM131216859

Questions Cloud

Calculate the future value of the single cash flow deposited : calculate the future value of the single cash flow deposited today at the end of the deposit period if the interest is compounded annually at the rate specified.

Comprehensive forecast of the revenue-costs and cash flows : Imagine that you are a financial advisor for Netflix, Inc., and Amazon.com, Inc. You are tasked with creating a comprehensive forecast of the revenue, costs, and cash flows of these companies, answering key questions that may influence their future d..

To fulfill the rising demand for prototype manufacturing : To fulfill the rising demand for prototype manufacturing your company is considering purchasing a new set of machine tools that will be dedicated to these small scale prototype production runs. What are the additional taxable incomes during each of t..

How are implicit taxes related to deprecation : How are implicit taxes related to deprecation? To lease or not to lease is in the right clientele? Should a low tax firm have long term debt?

Determine the issue price of the bonds : On June 1, 2014, Mink Company issued $12,000,000 of 10 percent bonds to yield 12 percent. Interest is payable semiannually on May 31 and November 30. The bonds mature in 15 years. Mink Company is a calendar-year corporation. Determine the issue price..

Determine amount of interest to be capitalized by black : During 2014, Black Corp. constructed a new manufacturing facility at a cost of $14,000,000. The weighted average accumulated expenditures for 2014 were calculated to be $6,000,000. Determine the amount of interest to be capitalized by Black for 2014.

Individual research variables and suspects possible effects : A researcher has collected data on five individual research variables and suspects possible effects or associations among the the variables (but is not sure which ones). Devise and discuss a viable research strategy so that the researchers may system..

Estimate of the value of greshaks operations : Let's assume that Greshak Company projects its Free Cash Flow to be $100,000 next year. Further, the company estimates its WACC to be 13% and long-term sustainable growth rate to be 3%. Based on these factors, what is your estimate of the value of Gr..

What does that imply about the rate of return : Jim Nance has been offered an investment that will pay him $ 770 three years from today. If his opportunity cost is 8% compounded anually, What is the most he should pay today? What does that imply about the rate of return that he will earn on the? i..

User Account

All Pages