Prepare a bond amortization schedule

Assignment Help Finance Basics

Reference no: EM1364591

A company issued 10%, 10-year, $10,000,000 par value bonds that pay interest semiannually on April 1 and October 1. The bonds are dated April 1, 2004 and are issued on that date. The market rate of interest for such bonds on April 1, 2004 is 8%. The company uses the effective interest rate method of amortization.

1. Prepare a bond amortization schedule.
2. Prepare all journal entries made for the issuance of the bonds, and the October 1, 2006 and April 1, 2008 interest payments.
3. Prepare the adjusting entry on December 31, 2012.
4. Assume that 50% of the bonds are called on October 2, 2012 at 98. Make the necessary journal entries. (Do not accrue interest for one day).
5. Assume that the market rate was 12% when the bonds were issued. Make the necessary journal entry to record the issuance of the bonds.

Reference no: EM1364591

Questions Cloud

Explain how much is he working per day : Identify the point on the budget constraint this worker has chosen. Explain how much is he working per day.

Database to keeps track of students in university : University XYZ needs a database that keeps track of students, what classes they taken and the grades for each of the classes.

Determine activity-based costing and traditional costing : How would you describe activity based costing? Also, can you explain why it might result in more accurate product costing information than the product cost derived under the traditional costing approach?

Explain the methods and make recommendations : Explain the methods and make recommendations for improvement and Be realistic and consider if and how the difficult economy is impacting your employer

Prepare a bond amortization schedule : A Corporation issued 10 percent, 10-year, $10,000,000 par value bonds that pay interest semiannually on April 1 and October 1. The bonds are dated April 1, 2004 and are issued on that date.

Describe the competitive strategies : Describe the following competitive strategies and use at least two corporate examples

Bone markings of the vertebrae : Compare the bone markings of the vertebrae and distinguish the differences between the cervical, thoracic, and lumbar vertebrae.

Is equilibrium quantity higher or lower or is the change : Is the equilibrium price higher or lower, or is the change indeterminate. Is the equilibrium quantity higher or lower, or is the change indeterminate.

Compute the cost of sorting the relation in seconds : Suppose a flash storage device is used instead of disk, and it has a seek time of 1 microsecond and a transfer rate of 40 MB per second. Recompute the cost of sorting the relation in seconds with.

User Account

All Pages