Reference no: EM131292111
On January 1, 2016, Drennen, Inc., issued $3.1 million face amount of 11-year, 10% stated rate bonds when market interest rates were 8%. The bonds pay semiannual interest each June 30 and December 31 and mature on December 31, 2025.
a. Calculate the proceeds (issue price) of Drennen, Inc.'s, bonds on January 1, 2016, assuming that the bonds were sold to provide a market rate of return to the investor. (Round PV factor to 4 decimal places.)
proceeds=?
b-1. Assume instead that the proceeds were $3,052,000. Use the horizontal model to record the payment of semiannual interest and the related discount amortization on June 30, 2016, assuming that the discount of $48,000 is amortized on a straight-line basis. (Use amounts with + for increases and amounts with – for decreases.)
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: On January 1, 2016, Drennen, Inc., issued $3.1 million face amount of 11-year, 10% stated rate bonds when market interest rates were 8%. The bonds pay semiannual interest each June 30 and December 31 and mature on December 31, 2025. Calculate the pro..
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