On January 1, the company issued 15-year bonds with a face value of $100,000. The bonds carry a coupon rate of 8%, and interest is paid semiannually. On the issue date, the market interest rate for bonds issued by companies with similar risk was 10% compounded semiannually. The issuance price of the bonds was $84,628. Make the journal entries needed on the books of the issuer to record the first two interest payments on June 30 and December 31. Use effective-interest amortization of the bond discount.
Answer to relevant QuestionsThe company issued convertible bonds with a total face value of $100,000 for $107,000. If the bonds had been issued without the conversion feature, their issuance price would have been $98,000. Make the journal entry ...Assume that $200,000 of Baker School District 6% bonds are sold on the bond issue date for $185,788. Interest is payable semiannually, and the bonds mature in 10 years. The purchase price provides a return of 7% on the ...On June 1, 2007, Sunderland Inc. purchased as a long-term investment 400 of the $1,000 face value, 8% bonds of Stateline Corporation for $364,547. The bonds were purchased to yield 10% interest. Interest is payable ...When companies raise money through the issuance of bonds or other long-term debt instruments, debt holders typically require the company to comply with certain conditions, or covenants. The notes to Circle K’s 1989 ...On January 1, the company granted 100,000 stock options to key employees. Each option allows an employee to buy one share of $1 par common stock for $30, which was the market price of the shares on the grant date of January ...
Post your question