Question: Ripkin Company issues 9%, five- year bonds dated January 1, 2013, with a $ 320,000 par value. The bonds pay interest on June 30 and

Ripkin Company issues 9%, five- year bonds dated January 1, 2013, with a $ 320,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $ 332,988. Their annual market rate is 8% on the issue date.

Required

1. Calculate the total bond interest expense over the bonds’ life.

2. Prepare a straight- line amortization table like Exhibit 14.11 for the bonds’ life.

3. Prepare the journal entries to record the first two interest payments.

Step by Step Solution

★★★★★

3.41 Rating (167 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Part 1 Ten payments of 14400 144000 Par value at maturity 320000 Total repaid 464000 Less amount ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

267-B-A-L (3034).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

gravity model is proposed to generate a 3x3 trip distribution matrix. The expected total trip productions are 0 = 250, 02 = 1 where cij is A doube-constrained 415, and 03 = 395, and the expected trip...

Prepare the necessary journal entries to record the following transactions relating to the long-term issuance of bonds of Pitts Co.: March 1: Issued $2,000,000 face value Pitts Co. seconds mortgage,...

Prepare the general journal entries to record the following transactions of the Quinones County General Fund: 1. Quinones County borrowed $1,000,000 by issuing six-month tax anticipation notes...

Ripkin company issues 9%, five year bonds dated January 1, 2013, with a 320,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of 332,988 there annual market...

252Fims.mnheducation.com 252Fmgmiddleware%252Fmheproducts 252Fims cami Saved Ellis Company issues 75%, five year bonds dated January 1, 2020, with a $520.000 par value. The bonds pay interest on June...

Elis Company issues 9.0%, five year bonds dated January 1, 2020, with a $410,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $426,627 The annual market...

Ellis issues 6.5%, five- year bonds dated January 1, 2013, with a $ 250,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $ 255,333. The annual market rate...

Ellis Company issues 70%, five year bonds dated January 1, 2019, with a $450,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $469,193. The annual market...

Elis Company issues 9.5%, five year bonds dated January 1, 2019 with a $560,000 per value. The bonds pay interest on June 30 and December 31 and are issued at a price of $594.066. The annual market...

Lew owns a store on Canal Street in New Orleans. He paid a person named Mike and other individuals commissions for customers brought into the store. Lew testified that he had known Mike for less than...

You have an evacuated container of fixed volume and known mass and introduce a known mass of a gas sample. Measuring the pressure at constant temperature over time, you are surprised to see it slowly...

Find the present value of the given amounts at the given interest rate. $42,000 in 7 years; 12% compounded monthly

Should all cash payments and receipts made by the firm be included in the cash budget?

Refer to the bond details in Problem 14-2B, except assume that the bonds are issued at a price of $4,192,932. Required 1. Prepare the January 1, 2013, journal entry to record the bonds issuance. 2....

Rogers Company signs a five-year capital lease with Packer Company for office equipment. The annual lease payment is $10,000, and the interest rate is 8%. Required 1. Compute the present value of...

A company issues 8%, 20-year bonds with a par value of $500,000. The current market rate for the bonds is 8%. The amount of interest owed to the bondholders for each semiannual interest payment is a....

Assuming that the returns from holding small-company stocks are normally distributed. Assume the average annual return for holding the small-company stocks for a period of time was 18.4 percent and...

Given the following data set, show all work to calculate Q1, Q2, Q3, and the IQR. Use an appropriate calculation to determine if there are any outliers. [2K/2A] 31 22 21 21 20 20 21 20 32 28 32 29 35...

QUESTION 1 4 What did TARP, passed in October 2 0 0 8 , aim to do ? a . decrease liquidity b . increase the discount rate c . freeze financial flows d . unfreeze financial flows e . lower taxes