On January 1, 2015, Buchheit Enterprises reported $ 95,000 in a liability called “Bonds Payable, Net.” This liability related to a $ 100,000 bond with a stated interest rate of 5 percent that was issued when the market interest rate was 6 percent. Assuming that interest is paid December 31 each year, prepare the journal entry to record interest paid on December 31, 2015, using the simplified effective-interest method shown in Chapter Supplement 10C.
Answer to relevant QuestionsAhlers Clocks is a retailer of wall, mantle, and grandfather clocks and is located in the Empire Mall in Sioux Falls, South Dakota. Assume that a grandfather clock was sold for $ 10,000 cash plus 4 percent sales tax. The ...Barton Chocolates used a promissory note to borrow $ 1,000,000 on July 1, 2015, at an annual interest rate of 6 percent. The note is to be repaid in yearly installments of $ 200,000, plus accrued interest, on June 30 of ...Refer to the information in E10-9 and assume Grocery Corporation accounts for the bond using the shortcut approach shown in Chapter Supplement 10C. Required: 1. Prepare the journal entry to record the bond issuance. 2. ...Condé Nast is a publisher of magazines. Its accounting policy for subscriptions follows: Revenues Sales of our magazine subscriptions are deferred (as unearned revenue) and recognized as revenues proportionately over the ...Southwest Corporation issued bonds with the following details: Face value: $ 600,000 Interest: 9 percent per year payable each December 31 Terms: Bonds dated January 1, 2015, due five years from that date The annual ...
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