Reference no: EM13914161
On January 1, a company issues bonds dated January 1 with a par value of $400,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $383,793. The journal entry to record the issuance of the bond is:
a. Debit Cash $400,000; debit Discount on Bonds Payable $16,207; credit Bonds Payable $416,207.
b. Debit Cash $383,793; debit Discount on Bonds Payable $16,207; credit Bonds Payable $400,000.
c. Debit Bonds Payable $400,000; debit Bond Interest Expense $16,207; credit Cash $416,207.
d. Debit Cash $383,793; debit Premium on Bonds Payable $16,207; credit Bonds Payable $400,000.
e. Debit Cash $383,793; credit Bonds Payable $383,793.
|
Obsolete inventory
: wrote off obsolete inventory of $100,000 during 2016. What was the effect of this write-off on Zenk's ratio analysis?
|
|
Installment not payable
: On August 1, a $30,000, 6%, 3-year installment note payable is issued by a company. The note requires equal payments of principal plus accrued interest be paid each year on July 31.
|
|
Calculate net cash flows from operating activities
: Accounts Payable decreased by $14,000, and Accrued Liabilities decreased by $1,700. Use the indirect method to determine net cash flows from operating activities.
|
|
Prevailing market price
: When a market is perfectly competitive, individual sellers. can sell all that they want at the prevailing market price.
|
|
Bonds mature
: The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31.
|
|
Prepare the cash flows from investing activities section
: Prepare the cash flows from investing activities section and the schedule of noncash investing and financing transactions of the statement of cash flows.
|
|
Tax return problem decision making
: Tax Return Problem ;Decision Making ;Communications Jane Smith, age 40, is single and has no dependents. She is employed as a legal secretary by Legal Services, Inc. She owns and operates Typing Services located near the campus of Florida Atlantic Un..
|
|
Method to amortize the discount
: The company uses the straight-line method to amortize the discount.
|
|
Identify each given transaction as an operating activity
: Identify each transaction as (a) an operating activity, (b) an investing activity, (c) a financing activity, (d) a noncash transaction, or (e) not on the statement of cash flows.
|