Bonds were issued when the prevailing rate of interest

Assignment Help Financial Accounting
Reference no: EM131356662

On Dec 31. 2010, a company. Has a $200,00 6% annual coupon bond outstanding that matures in three years. The bonds were issued when the prevailing rate of interest was 7%. On Dec 31, 2010, the company negotiates a restructure agreement with the bond holder. The face value (amount payable at maturity) of the bonds is reduced to $170,000 and the annual interest payments are reduced to $9,000 each. How much gain on restructure will the company recognize on Dec 31, 2010?

Reference no: EM131356662

Questions Cloud

How would you define the organization culture of cintas : How would you define the organization culture of Cintas? Is it an environment where you would enjoy working?  Using the Competing Values Framework, what type of culture doing you think exists at Cintas? Why?
What is the difference between a hot site and a cold site : Describe the four phases/storage locations through which a program under development should pass to ensure good program change control.
Discuss how creativity and innovation are link at inventable : How has Inventables changed the innovation process in American businesses? Discuss how creativity and innovation are linked at Inventables. If you were Zach Kaplan, how would you innovate Inventables even further?
Which plans apply to an offline environment : What are the control plans for restricting access to stored programs, data, and documentation? Which of these plans apply to an online environment, and which plans apply to an offline environment?
Bonds were issued when the prevailing rate of interest : On Dec 31. 2010, a company. Has a $200,00 6% annual coupon bond outstanding that matures in three years. The bonds were issued when the prevailing rate of interest was 7%. On Dec 31, 2010, the company negotiates a restructure agreement with the bond ..
What control plans are designed to prevent such hazards : What kinds of damage are included in the category of environmental hazards?- What control plans are designed to prevent such hazards from occurring?
What are the advantages of given specialization : Saboor and Kawa Hatef divide responsibilities for running Platinum Autobody. What are the advantages of such specialization? How is Platinum Autobody using technology to improve its business?
Create a resource as a way to share this information : Create a resource as a way to share this information. Examples include the following:A social media page,An information pamphlet,A presentation,Consider the best method so it is crafted in an appropriate and understandable way for your identified aud..
Explain how theories of organisational behaviour : Explain how theories of organisational behaviour may be applied in an organisational setting - Evaluate potential organisational problem situations and formulate proactive managerial interventions, with special sensitivity to cultural, ethical and ..

Reviews

Write a Review

Financial Accounting Questions & Answers

  On january 12014 oaken furniture co issued 700000 of 10

on january 12014 oaken furniture co. issued 700000 of 10 bonds and received cash totaling 795141. interest is payable

  Total annual inventory and purchasing cost

You are the purchasing manager of a hospital. The hospital uses a particular medical product more or less constant at 7871 units per year. You purchase the product from a supplier for $80.97 per unit. It costs about $11.4 per unit to store the produc..

  Assess the control risk over shipping and billing functions

Your firm has selected you to develop and assess the control risk over shipping and billing functions of ABC Company. The audit manager wishes to rely on control risk assessment at a low level. In other words, the firm would like to be able to assess..

  Interest on the weighted average capital balance

Adams, Brown, and Collins are partners in a sporting goods outlet. The business began operations on January 1, 19x1, with Adams investing $10,000, Brown $20,000, and Collins $26,000. Adams withdrew $4,000 on April1, Brown $6,000 on May 1 and $6,000 o..

  Cost of goods sold using the FIFO and LIFO methods

Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods. Prove the amount allocated to cost of goods sold under each method?

  What would the year-end entry

A machine was purchased for $28,000 and had an estimated scrap value of $4,000. What would the year-end entry be if the units of-production method was used, and it had an estimated life of 32,000 hours? In the first year of operation, it used 7,20..

  Magdalena schmitz has undergone some major changes

Magdalena Schmitz has undergone some major changes in her life recently. In 2012, at the age of 46, her husband, Roger, passed away. Magdalena has not remarried as of the end of 2014.

  Write policy statement related to the allocation of expenses

Calculate what the company's net income would be if Division B were closed down. Write a policy statement related to the allocation of fixed expenses.

  Applies manufacturing overhead on the basis of machine-hours

Acitelli Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations. The overhead for the year was: $1,520 underapplied $2,520 overapplied $1,520 overapplied..

  What is the likely response from the board members

What are the issues that you will take into account and what is the likely response from the board members?

  Prepare the journal entry to record the first fixed payment

1.On January 1, Seneca Asset Management enters into a contract with a client to provide fund management services for one year.

  Total labor variance and labor price variance

Hartley Company’s standard labor cost per unit of output is $29.43 (2.7 hours x $10.90 per hour). During August, the company incurs 3,300 hours of direct labor at an hourly cost of $11.23 per hour in making 1,200 units of finished product. Compute th..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd