Arshad Trading Company was in need of some additional funds for establishment of a sales branch...

 

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Arshad Trading Company was in need of some additional funds for establishment of a sales branch in the commercial area of the city. Therefore, it issued on 01 March 2020 4,000 12% Bonds of Rs. 2,000 at Rs. 2100 each with the maturity of 04 years. The interest is payable after every 06 months. The bonds are retired at maturity. Required: a) Record necessary accounting entries for issuance of bonds and payment of periodic interest. b) c) d) c) Carryout adjustment of amortization of Bonds premium under straight line method at each interest payment. Present the bonds and premium in balance sheet prepared as at 30 June, 2020 Retirement of Bonds at maturity. What was the effective rate of interest on these bonds? Arshad Trading Company was in need of some additional funds for establishment of a sales branch in the commercial area of the city. Therefore, it issued on 01 March 2020 4,000 12% Bonds of Rs. 2,000 at Rs. 2100 each with the maturity of 04 years. The interest is payable after every 06 months. The bonds are retired at maturity. Required: a) Record necessary accounting entries for issuance of bonds and payment of periodic interest. b) c) d) c) Carryout adjustment of amortization of Bonds premium under straight line method at each interest payment. Present the bonds and premium in balance sheet prepared as at 30 June, 2020 Retirement of Bonds at maturity. What was the effective rate of interest on these bonds?

Answer rating: 100% (QA)

a Record necessary accounting entries for issuance of bonds and payment of periodic interest On 01 M... View the full answer