User Account

All Pages

How much cash flowed in and out on this investment

Assignment Help Accounting Basics
Reference no: EM132773924

Question - Petersen Stores invested in $100,000 face amount of 4-year bonds issued by Erik Food Supply Company on January 1, 20X1. The bonds were purchased at 98, and bear interest at a stated rate of 8% per annum, payable semiannually.

Required -

(a) Prepare the journal entry to record the initial investment on January, 20X1.

(b) Prepare the journal entry that Petersen would record on each interest date.

(c) Prepare the journal entry that Petersen would record at maturity of the bonds.

(d) How much cash flowed "in" and "out" on this investment, and how does the difference compare to total interest income that was recognized?

Reference no: EM132773924

Questions Cloud

Prepare the appropriate journal entry for the transaction : The stand-alone price of the equipment is $184,800 and the other service contract sells separately for $79,200. Prepare the appropriate journal entry
History of cryptography : You will evaluate the history of cryptography from its origins. Analyze how cryptography was used and describe how it grew within history.
Define communication and discuss importance in healthcare : Define communication and discuss its importance in healthcare. Name three variables that can affect organizational communication-assign their impact on outcomes
Companies operating in the global marketplace : Who is to judge what is morally correct for companies operating in the global marketplace?
How much cash flowed in and out on this investment : How much cash flowed "in" and "out" on this investment, and how does the difference compare to total interest income that was recognized
Explain in detail the pros and cons of buying : (b) You are a Small business owner intending to borrow funds from the bank. Draw up a brief summarized business plan for your business
Cost benefit analysis hypothetical situation : Cost benefit analysis hypothetical situation. Select an access control based on a hypothetical situation and justify the cost based on the risk .
What is the value of the inheritance today : You will receive an inheritance of $500,000 in 20 years on your 40th birthday. What is the value of the inheritance today if the discount rate is 10%
How your personality type can enhance effective leadership : Integrates how your specific personality type can enhance or hinder effective leadership in the health care environment. n the health care environment.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd