What the book value of the bond at the end of second year

Assignment Help Accounting Basics
Reference no: EM131697356

Question - Garcia, Inc. decided to issue bonds to raise capital for a new acquisition. On January 1, they issued bonds with a 15 year maturity and an interest rate of 6% paid annually. The face amount of each bond was $1,000. At the time of issuance the market rate of interest was 8%. Prepare journal entries to record the issuance of one of these bonds and to record the payment of interest for the first two years. What was the book value of the bond at the end of the second year? Ignore issuance costs.

Reference no: EM131697356

Questions Cloud

Does art imitate life or does life imitate art : Is art driven by the world (society) in which it's created or does it drive the world (society) in which it's created in a specific direction?
Compute the budgeted divisional roi : Return on Investment for Multiple Investments, Residual Income The manager of a division that produces add-on products for the automobile industry.
What makes bill gates a leader : What makes Bill Gates a leader? Discusses at least 3 leadership theories of Bill Gates. How do you compare his leadership styles to Northouse, P. G. (2004).
Application transaction processing system : Find a real-world application Transaction Processing System (you can analyze examples you find online or in your real-world experience).
What the book value of the bond at the end of second year : Garcia, Inc. decided to issue bonds to raise capital for a new acquisition. What was the book value of the bond at the end of the second year
Here is my essay topic for public relations : Imagine that you are working as a public relations professional whose primary responsibility is managing the image and reputation for a beverage company
Concludion of some possibly difficult negotiations : The formulation of the export sales contracts represents the concludion of some possibly difficult negotiations. Discussion two items that should be included
What rules should i follow to have effective presentation : What rules should I follow to have effective presentation? What considerations are there whaen adding visuals aids to a presentation?
What are the monthly payments : You wish to buy a $22,000 car. The dealer offers you a 5-year loan with a 9 percent APR. What are the monthly payments

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.

  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!

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