Question: questions were given that way, solve i guess 4,895,980 Problem 14-2A (40 minutes) Part 1 Jan. 1 Cash... Premium on Bonds Payable.. Bonds Payable Sold

questions were given that way, solve i guess

Cash Payment = $4,000,000 x 6% x 6/12 = $120,000 895,980 4,000,000

4,895,980 Problem 14-2A (40 minutes) Part 1 Jan. 1 Cash... Premium on Bonds Payable.. Bonds Payable Sold bonds on issue date at a premium. Part 2 (a) Cash Payment = $4,000,000 x 6% x 6/12 = $120,000 895,980 4,000,000 (b) Premium = $4,895,980 - $4,000,000 = $895,980 Straight-line premium amortization = $895,980 / 30 semiannual periods = $29,866 (c) Bond interest expense = $120,000 - $29,866 = $90,134 Part 3 Thirty payments of $120,000.. ...$ 3,600,000 Less premium (895,980) Total bond interest expense.......... ...............$ 2,704,020 or: Thirty payments of $120,000 .. ..$3,600,000 Par value at maturity. ... 4,000,000 Total repaid................................................ 7,600,000 Less amount borrowed.............................(4,895,980) Total bond interest expense....................$2.704,020 Problem 14-2A (Concluded) Part 4 Semiannual Period-End Unamortized Premium Carrying Value 1/01/2019 $895,980 $4,895,980 6/30/2019.. 866,114 4,866,114 12/31/2019. 836,248 4,836,248 6/30/2020. 806,382 4,806,382 12/31/2020. 776,516 4,776,516 Part 5 June 30 .90,134. ..29,866. Bond Interest Expense.... Premium on Bonds Payable.... Cash............... Record six months' interest and premium amortization. 120,000 Dec. 31 .90,134. .29,866. Bond Interest Expense........ Premium on Bonds Payable. Cash........... Record six months' interest and premium amortization. 120,000 4,895,980 Problem 14-2A (40 minutes) Part 1 Jan. 1 Cash... Premium on Bonds Payable............. Bonds Payable. Sold bonds on issue date at a premium. Part 2 (a) Cash Payment = $4,000,000 x 6% x 6/12 = $120,000 895,980 4,000,000 (b) Premium = $4,895,980 - $4,000,000 = $895,980 Straight-line premium amortization = $895,980 / 30 semiannual periods = $29,866 (c) Bond interest expense = $120,000 - $29,866 = $90,134 Part 3 Thirty payments of $120,000..........................$ 3,600,000 Less premium.. (895,980) Total bond interest expense. ......$ 2,704,020 or: Thirty payments of $120,000 ..$3,600,000 Par value at maturity...... .. 4,000,000 Total repaid................ ......................... . 7,600,000 Less amount borrowed..............................4.895,980) Total bond interest expense....................$2,704,020 Problem 14-2A (Concluded) Part 4 Semiannual Period-End Unamortized Premium Carrying Value 1/01/2019.. $895,980 $4,895,980 6/30/2019. 866,114 4,866,114 12/31/2019 836,248 4,836,248 6/30/2020... 806,382 4,806,382 12/31/2020. 776,516 4,776,516 Part 5 June 30 .......90,134. ..29,866. Bond Interest Expense..... Premium on Bonds Payable. Cash. Record six months' interest and premium amortization. 120,000 Dec. 31 ..90,134. 29,866. Bond Interest Expense. Premium on Bonds Payable............ Cash... Record six months' interest and premium amortization. 120,000 4,895,980 Problem 14-2A (40 minutes) Part 1 Jan. 1 Cash... Premium on Bonds Payable.. Bonds Payable Sold bonds on issue date at a premium. Part 2 (a) Cash Payment = $4,000,000 x 6% x 6/12 = $120,000 895,980 4,000,000 (b) Premium = $4,895,980 - $4,000,000 = $895,980 Straight-line premium amortization = $895,980 / 30 semiannual periods = $29,866 (c) Bond interest expense = $120,000 - $29,866 = $90,134 Part 3 Thirty payments of $120,000.. ...$ 3,600,000 Less premium (895,980) Total bond interest expense.......... ...............$ 2,704,020 or: Thirty payments of $120,000 .. ..$3,600,000 Par value at maturity. ... 4,000,000 Total repaid................................................ 7,600,000 Less amount borrowed.............................(4,895,980) Total bond interest expense....................$2.704,020 Problem 14-2A (Concluded) Part 4 Semiannual Period-End Unamortized Premium Carrying Value 1/01/2019 $895,980 $4,895,980 6/30/2019.. 866,114 4,866,114 12/31/2019. 836,248 4,836,248 6/30/2020. 806,382 4,806,382 12/31/2020. 776,516 4,776,516 Part 5 June 30 .90,134. ..29,866. Bond Interest Expense.... Premium on Bonds Payable.... Cash............... Record six months' interest and premium amortization. 120,000 Dec. 31 .90,134. .29,866. Bond Interest Expense........ Premium on Bonds Payable. Cash........... Record six months' interest and premium amortization. 120,000 4,895,980 Problem 14-2A (40 minutes) Part 1 Jan. 1 Cash... Premium on Bonds Payable............. Bonds Payable. Sold bonds on issue date at a premium. Part 2 (a) Cash Payment = $4,000,000 x 6% x 6/12 = $120,000 895,980 4,000,000 (b) Premium = $4,895,980 - $4,000,000 = $895,980 Straight-line premium amortization = $895,980 / 30 semiannual periods = $29,866 (c) Bond interest expense = $120,000 - $29,866 = $90,134 Part 3 Thirty payments of $120,000..........................$ 3,600,000 Less premium.. (895,980) Total bond interest expense. ......$ 2,704,020 or: Thirty payments of $120,000 ..$3,600,000 Par value at maturity...... .. 4,000,000 Total repaid................ ......................... . 7,600,000 Less amount borrowed..............................4.895,980) Total bond interest expense....................$2,704,020 Problem 14-2A (Concluded) Part 4 Semiannual Period-End Unamortized Premium Carrying Value 1/01/2019.. $895,980 $4,895,980 6/30/2019. 866,114 4,866,114 12/31/2019 836,248 4,836,248 6/30/2020... 806,382 4,806,382 12/31/2020. 776,516 4,776,516 Part 5 June 30 .......90,134. ..29,866. Bond Interest Expense..... Premium on Bonds Payable. Cash. Record six months' interest and premium amortization. 120,000 Dec. 31 ..90,134. 29,866. Bond Interest Expense. Premium on Bonds Payable............ Cash... Record six months' interest and premium amortization. 120,000

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