User Account

All Pages

The issuance of the bonds by cromley

Assignment Help Accounting Basics
Reference no: EM131006629

On February 1, 2011, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of $80 million. The bonds mature on January 31, 2015 (4 years). The market yield for bonds of similar risk and maturity was 10%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $80,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31.

Required:

1. Determine the price of the bonds issued on February 1, 2011.

2. Prepare amortization schedules that indicate 

(a) Cromley's effective interest expense and 

(b) Barnwell's effective interest revenue for each interest period during the term to maturity.

3. Prepare the journal entries to record 

(a) The issuance of the bonds by Cromley and 

(b) Barnwell's investment on February 1, 2011.

4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2013.

Reference no: EM131006629

Questions Cloud

Problem regarding the arbitration program : Employees who continued to work after the effective date of the new policy were deemed to have accepted it. When an employee told the president that he would not sign, he was told "not to worry about it." Subsequently, a new employee handbook was ..
Sources of inputs into the microeconomics in context model : Sources of inputs into the microeconomics in context model include:
Find examples of substances : Find examples of substances that are usually found in one "state" and either naturally or through the intervention of humans change "states".
How can crm add value to an organisation : How can CRM add value to an organisation - Identify any organisational risk that a business may encounter as part of a CRM implementation.
The issuance of the bonds by cromley : Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2013.
Discuss the appropriateness of the framework for the study : A 2- to 3-paragraph analysis of the framework in the article and how you know which one is being used. Then, discuss the appropriateness of the framework for the study
Why is the sky blue : Why is the sky blue? Could someone please explain this to me
How did the enron case impact corporate america : Provide an overview of the Sarbanes-Oxley Act of 2002. In reference to the article, how did Enron fail to follow their own code of ethics? Do you believe that the Sarbanes-Oxley Act of 2002 has helped to prevent securities fraud why or why not?
Copies of new dispute resolution procedure : The employee signed an attendance sheet acknowledging receipt of the materials. Three months later the employee was terminated. He sued for discrimination. The company went to court to compel arbitration. What should the court decide? Why? (Highto..

Reviews

Write a Review

Accounting Basics Questions & Answers

  Annual depreciation charges over the asset

Assume a fiscal year-end of September 30. Compute the annual depreciation charges over the asset's life applying each of the following methods.

  At december 31 2010 kifer company had 500000 shares of

at december 31 2010 kifer company had 500000 shares of common stock outstanding. on october 1 2011 an additional 100000

  Amount of net passive losses

Arnold purchased interests in two limited partnerships 6 years ago. During 2010, Arnold had income of $22,000 from one of the partnerships. He had a loss from the other partnership of $32,000, salary income of $35,000 and dividend income of $2,000..

  Process costing system basics

Which of the following products is more likely to be costed and controlled under a Job Order Costing system, rather than a Process Costing system?

  Describe three issuesproblems that a company could

describe three issuesproblems that a company could encounter when trying to determine the actual cost of a good or

  Determine the cumulative amount of overapplied

As of February 1, actual overhead was underapplied by $500,000. Determine the cumulative amount of any overapplied or underapplied overhead at the end of February.

  Prepare a june income statement

Holly Nikolas launched a new business, Holly's Maintenance Co., that began operations on June 1. The following transactions were completed by the company during that first month.

  Preparing a statement of financial condition

Prepare a statement of financial condition for Mr. Holz as of December 31, 2008. Assume any gain on subsequent sale of the residence will not be tax-exempt.

  Explain how the british true and fair audit approach or

explain how the british true and fair audit approach or strategy differs from the audit philosophy applied in the

  Dividends per share for preferred and common stock

Sanchez Company has 30,000 shares of 1% preferred stock of $100 par and 100,000 shares of $50 par common stock. The following amounts were distributed as dividends: Determine the dividends per share for preferred and common stock for each year.

  Callaghan motors bonds have 9 years remaining to maturity

callaghan motors bonds have 9 years remaining to maturity. interest is paid annually they have a 1000 par value the

  Calculate ken itemized deduction for interest on schedule

In addition, during the year they drove 109 miles for medical transportation, and their insurance company reimbursed them $900 for the above expenses. Calculate the Murphy's medical expense deduction.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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