On January 1, 2021, Tennessee Harvester Corporation issued debenture bonds that pay interest semiannually on June...
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On January 1, 2021, Tennessee Harvester Corporation issued debenture bonds that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below: Increase in Outstanding Balance Cash Effective Payment Payment Interest Balance 352, 000 352, 000 352, 000 352,000 352, 000 352, 000 364,500 365, 125 365, 781 366, 470 367, 194 12,500 13, 125 13, 781 14,470 7, 290, 000 7, 302, 500 7,315, 625 7,329, 406 7,343, 876 2 4 7,359, 070 7,375, 024 15, 194 367, 954 15,954 352,000 352, 000 352, 000 8, 636, 373 8,716, 192 8,800,000 38 428,018 431, 819 435, 808 76,018 79,819 83, 808 39 co O o Required: 1. What is the face amount of the bonds? 2. What is the initial selling price of the bonds? 3. What is the term to maturity in years? 4. Interest is determined by what approach? 5. What is the stated annual interest rate? 6. What is the effective annual interest rate? 7. What is the total cash interest paid over the term to maturity? 8. What is the total effective interest expense recorded over the term to maturity? 1. Face amount 2. Initial selling price 3. Term to maturity 4. Interest is determined by what approach? 5. Annual interest rate 6. Effective annual interest rate years % % 7. Total cash interest paid 8. Effective interest expense On January 1, 2021, Tennessee Harvester Corporation issued debenture bonds that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below: Increase in Outstanding Balance Cash Effective Payment Payment Interest Balance 352, 000 352, 000 352, 000 352,000 352, 000 352, 000 364,500 365, 125 365, 781 366, 470 367, 194 12,500 13, 125 13, 781 14,470 7, 290, 000 7, 302, 500 7,315, 625 7,329, 406 7,343, 876 2 4 7,359, 070 7,375, 024 15, 194 367, 954 15,954 352,000 352, 000 352, 000 8, 636, 373 8,716, 192 8,800,000 38 428,018 431, 819 435, 808 76,018 79,819 83, 808 39 co O o Required: 1. What is the face amount of the bonds? 2. What is the initial selling price of the bonds? 3. What is the term to maturity in years? 4. Interest is determined by what approach? 5. What is the stated annual interest rate? 6. What is the effective annual interest rate? 7. What is the total cash interest paid over the term to maturity? 8. What is the total effective interest expense recorded over the term to maturity? 1. Face amount 2. Initial selling price 3. Term to maturity 4. Interest is determined by what approach? 5. Annual interest rate 6. Effective annual interest rate years % % 7. Total cash interest paid 8. Effective interest expense
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Answer rating: 100% (QA)
a Face amount 8800000 b Initial selling price 7290000 c Term to ... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-1260481952
10th edition
Authors: J. David Spiceland, James Sepe , Mark Nelson, Wayne Thomas
Posted Date:
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