Question: please answer a, b, c, d, e, & f! (: Grove Corporation issued $6,000,000 of 8% bonds on January 1, 2017. due on January 1,
Grove Corporation issued $6,000,000 of 8% bonds on January 1, 2017. due on January 1, 2022. The interest is to be paid twice a year on July 1 and January 1. The bonds were sold to yield 10% effective annual interest. The proceeds from the bond issue were 55,536,676. Use this information to prepare a partial amortization schedule with rows for the date of issuance, and interest payment dates in 2017 and 2108. Use the effective-interest method. (Round all answers in your table to the nearest dollar.) You don't need to include the amortization schedule you create in your exam: you can use paper and pencil or Excel. Your amortization schedule will be a useful source document to help you provide answers to the following questions. a. Were these bonds issued at a discount or a premium? b. What is the dollar amount that appears in the Cash Paid column of your amortization table? Show the calculation of this dollar amount to maximize your chance for partial credit c. When the first interest payment is made on July 1, 2017, what is the amount of the debit to interest Expense? Show the calculation of this dollar amount to maximize your chance for partial credit. d. What is the carrying amount of the bonds after the July 1, 2017 journal entry is posted? e. What is the amount of discount amortization difference between cash paid and interest expense) associated with the January 1, 2018 interest payment? f. What is the carrying amount of the bonds after the july 1, 2018 journal entry is posted
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
