Prepare journal entries to record the retirement

Assignment Help Accounting Basics
Reference no: EM131106218

1. (Entries for Retirement and Issuance of Bonds) On June 30, 2002, Mendenhal Company issued 12% bonds with a par value of $600,000 due in 20 years. They were issued at 98 and were callable at 104 at any date after June 30, 2010. Because of lower interest rates and a significant change in the company's credit rating, it was decided to call the entire issue on June 30, 2011, and to issue new bonds. New 10% bonds were sold in the amount of $800,000 at 102; they mature in 20 years. Mendenhal Company uses straight-line amortization. Interest payment dates are December 31 and June 30. 

(a) Prepare journal entries to record the retirement of the old issue and the sale of the new issue onJune 30, 2011.

(b) Prepare the entry required on December 31, 2011, to record the payment of the first 6 months' interest and the amortization of premium on the bonds.

Reference no: EM131106218

Questions Cloud

Will the future value be larger or smaller : Will the future value be larger or smaller if we compound an initial amount more often than annually (e.g., semiannually, holding the stated (nominal) rate constant)? Why?
Record the interest at the end of the first year : Purchases equipment by issuing a 6%, 8-year promissory note having a maturity value of $400,000 (interest payable annually). The company has to pay 11% interest for funds from its bank.
How much would the 40 year-old investor have to save : How much would the 40-year-old investor have to save each year to accumulate the same amount at 65 as the 20-year-old investor?
How much will she have accumulated at age 65 : A 20-year-old student wants to save $3 a day for her retirement. Every day she places $3 in a drawer. At the end of each year, she invests the accumulated savings ($1,095) in a brokerage account with an expected annual return of 12%. If she keeps sav..
Prepare journal entries to record the retirement : Prepare the entry required on December 31, 2011, to record the payment of the first 6 months' interest and the amortization of premium on the bonds.
What is its present value : A 5-year $100 ordinary annuity has an annual interest rate of 10%. What is its present value?
What would the future and present values : What would the future and present values be if it was an annuity due?
Prepare the journal entries necessary to record issue : Prepare the journal entries necessary to record issue of the new bonds and the refunding of the bonds.
Number of interest periods over life of bond : (Information Related to Various Bond Issues) Pawnee Inc. has issued three types of debt on January 1, 2010, the start of the company's fiscal year.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Calculations and then perform the calculation

1. Estimate per share value of Handbook. Write steps in calculations and then perform the calculation. 2. Estimate current value per share for WhyApp. Write steps in calculations and then perform the calculation.

  Oceanaire amusement park is negotiating with an engineering

oceanaire amusement park is negotiating with an engineering firm in the planning design and construction of a new

  Show with a diagram the cash flows in this given deal

Show, with a diagram, the cash flows in this deal, assuming no Early Buyout Option. Would the deal make sense for DEF Leasing, assuming that its shareholders insist on a required return on equity of 15% p.a.

  What is vertical analysis

What is vertical analysis? When would you use vertical analysis instead of horizontal? Do companies use one or the other? Please explain. What about industry averages? How do people use industry averages for comparative analysis?

  Demi is an accounting analyst she made a name for herself

demi is an accounting analyst. she made a name for herself in the florida panhandle with several small businesses.

  Ralph forms a firm by investing 1000 dollars this cash is

ralph forms a firm by investing 1000 dollars. this cash is immediately paid for a machine with a useful life of 3

  Be certain to indicate the proper question number before

be certain to indicate the proper question number before each of your answers. remember to show your work if an answer

  Calculate the net benefit

Calculate the net benefit (cost) to HP of outsourcing the component from Samina-SCI. Use a negative sign with your answer, if appropriate.

  Discuss the ethical dilemma

Discuss the ethical dilemma or explain why you do not perceive an ethical dilemma.

  Explain from a public interest theory perspective

Explain from a ‘public interest theory perspective' the rationale for RP introducing the legislation and how RP will ultimately assess whether any proposed legislation should actually be introduced.

  On january 1 2012 muller co borrowed cash from washington

on january 1 2012 muller co. borrowed cash from washington valley bank by issuing a 100000 face value 3-year

  Using a departmental allocation system with machine hours

x company has two production departments a and b. at the start of the year the following budgeted information is

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