3. On January 1, 2020 Arawak Inc. issued $2,000,000 of 10-year, 9% bonds for $1,877,103. The...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
3. On January 1, 2020 Arawak Inc. issued $2,000,000 of 10-year, 9% bonds for $1,877,103. The bonds were isued when the market rate of interest was 10%. Interest is payable annually on December 31 each year. Arawak uses the effective-interest method of amortization. At the end of the first year, Arawak would repcrt an unamortized bond discount of: a. $115,187. b. $102,897. c. $104,126. d. $91,836. 3. On January 1, 2020 Arawak Inc. issued $2,000,000 of 10-year, 9% bonds for $1,877,103. The bonds were isued when the market rate of interest was 10%. Interest is payable annually on December 31 each year. Arawak uses the effective-interest method of amortization. At the end of the first year, Arawak would repcrt an unamortized bond discount of: a. $115,187. b. $102,897. c. $104,126. d. $91,836.
Expert Answer:
Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Posted Date:
Students also viewed these accounting questions
-
On January 1, when the market rate of interest was 5% for similar bonds, a company issued a $15,000,000, 5%, 10-year bond that pays semiannual interest on June 30 and December 31, receiving cash of...
-
For a bond when the market rate of interest is greater than the face rate of interest: (a) Describe the cash outflows shown on the budgeted cash flow statement over the life of the note. (b) Describe...
-
For a bond when the market rate of interest is less than the face rate of interest: (a) Describe the cash outflows shown on the budgeted cash flow statement over the life of the note. (b) Describe...
-
You are given the following information: The current gold price is $1,650, the net convenience yield for gold is 1.7% per year, the risk-free rate is 5% per year, the volatility is 30% per year, the...
-
What is the rule for assigning foreign keys in a 1: M association?
-
a. Give a measure of relative standing for the Nautilus Explorer score of 74. Interpret the result. b. Give a measure of relative standing for the Rotterdam's score of 92. Interpret the result. For...
-
Assume that a manufacturing company is determining the optimal minimum level of cash to maintain in a financial institution to cover short-term needs. Separately consider each of the following...
-
Sundial, Inc., produces two models of sunglasses: AU and NZ. The sunglasses have the following characteristics: The total fixed costs per year for the company are $1,104,000. Required a. What is the...
-
General Mills has a $1,000 par value, 12-year to maturity bond outstanding with an annual coupon rate of 10.38 percent per year, paid semiannually. Market interest rates on similar bonds are 10.04...
-
Suppose that Sasha and Jayla both collect data to investigate whether people tend to call heads more often than tails when they are asked to call the result of a coin flip. If Sasha has a smaller...
-
State of plane stress at a point on a surface of an aluminium (Al) alloy part is given below. (a) draw Mohr's circle. (b) calculate principal stress, and (c) calculate maximum shearing stress. 50 MPa...
-
What amounts are included in the asset cost of buying an imported machine from overseas (China to USA) for business purposes? Is general overhead included in this?
-
what are the merits and pitfalls of having a financial manager perform a dual role as a management accountant and financial manager in a private company?
-
Q1(d).You find there is a vacant piece of land next to the apartment building that's for sale for $4 million.Your business partner suggests you buy and hold the land for four years and sell it to a...
-
A hedge fund analyst is interested in the possible losses L for a certain stock. From historical data she has calculated the values of v1, v2, e1, e2 where: v=VaRa95 (L), v2 = VaRoss (L), e = ES0.95...
-
Joe transfers land with a FMV of $ 5 0 0 , 0 0 0 and basis of $ 1 0 0 , 0 0 0 for land owned by John. Land is subject to a mortgage of $ 1 0 0 , 0 0 0 ; John transfers $ 1 0 0 , 0 0 0 cash and land...
-
A shaft (r = 12 mm) made of pure iron (E = 190GPa, v = 0.29) is loaded at T = 900 C with a constant axial force F = 3500 N. Which creep mechanism will be predominant? Normalised stress o/G 1 10-1...
-
What are the 5 Cs of marketing channel structure?
-
Two independent situations are described below. Each situation has future deductible amounts and or future taxable amounts produced by temporary differences: The enacted tax rate is 40% for both...
-
W. Pickett Fence Company incurred a net loss for year 3. The firm does not have any book- tax differences. We present the results of operations for the first three years of the companys operations...
-
Jorge Corporation issued $ 100,000 par value, 6%, four- year bonds ( i. e., there were 100 $ 1,000 par value bonds in the issue). Interest is payable semiannually each January 1 and July 1 with the...
-
Devise a way of implementing in Mathematica an adjacency list representation of a graph. (See Exercise 19.) Write a function that converts an adjacency list to an adjacency matrix. Data from in...
-
Using the journal articles, newspapers, and the Internet, find one article that discusses the reasons why construction companies fail or outlines the failure of a specific construction company....
-
Determine and Use Overhead Rate Cortez Consulting, Inc., expects the following costs and expenses during the coming year: Required a. Compute a predetermined overhead rate applied on the basis of...
Study smarter with the SolutionInn App