Find adjusted balance in bonds payable account should be

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Reference no: EM132696903

On February 1, 2020, Cotton Corp. issued eight-year, 3% bonds with a face value of $ 600,000, with interest payable semi-annually on January 31 and July 31. The bonds were sold to yield 4%. The fiscal year-end of Cotton Corp. is December 31.

Related information is presented in the Table below:

Present value of 1 for 8 periods at 3% .789;    Present value of 1 for 8 periods at 4% .731
Present value of 1 for 16 periods at 1.5% .788;           Present value of 1 for 16 periods at 2% .728
Present value of annuity for 8 periods at 3% 7.020;    Present value of annuity for 8 periods at 2% 7.325
Present value of annuity for 8 periods at 4% 7.990;    Present value of annuity for 16 periods at 1.5% 14.131
Present value of annuity for 16 periods at 2% 13.578;

Problem 1: At December 31, 2020, the adjusted balance in the Bonds Payable account should be reported at the Statement of Financial Positions is:

a. $587,583
b. $563,035
c. $587,133
d. $574,907
e. $563,406

Reference no: EM132696903

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