1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
madreJ [45]
2 years ago
10

On January 1, the first day of its fiscal year, Pretender Company issued $12,700,000 of five-year, 11% bonds to finance its oper

ations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 13 resulting in Pretender Company receiving cash of $11,787,069 Required: A. Journalize the entries to record the following (refer to the Chart of Accounts for exact wording of account titles) 1. Issuance of the bonds.2. First semiannual interest payment. The bond discount is combined with the semiannual interest payment. (Round your answer to the nearest dollar.)3. Second semiannual interest payment. The bond discount is combined with the semiannual interest payment. (Round your answer to the nearest dollar) B. Determine the amount of the bond interest expense for the first year.C. Explain why the company was able to issue the bonds for only $12,787,069 rather than for the face amount of $12,700,000.
Business
1 answer:
yarga [219]2 years ago
7 0

Answer:

1) Debit Bank $11787069 Debit bond discount $912931 ; Credit Bond $12700000

2) Debit Interest expense $751293 ; Credit Bank $660,000 Credit Discount on Bond payable $91293

3 )Debit interest expense $ 751293 ; Credit bank 660000, Credit discount on bond payable $91293

b)Interest expense = $1502586

c)It is because a financial crisis might have happened prior to issuing the bond and the company still went ahead with issuing even though the rate has changed.

Explanation:

interest expense = 12000000 * 0.11 * 6/12=$660000

discount on bond payable = $912931 /5 = 182586 /2= 91293

Interest expense = $751293 * 2 = $1502586

You might be interested in
The total assets of brandon co. are $900,000 and its liabilities are equal to one-fourth of its total assets. what is the amount
yuradex [85]
900,000 / 1/4 = liabilities
900,000 - liabilities - stockholder's equity

900,000/4 = 225,000
900,000 - 225,000 = 675,000
5 0
3 years ago
Read 2 more answers
The ____ rule explains variation in employee conduct through generalizing on the percentage of employees in any given organizati
lana [24]

Answer: 10/40/40/10

Explanation:

Under the 10/40/40/10 rule, 10% of the employees tend to follow ones own attitudes and values, i.e. they believe that their beliefs are more remarkable than those around them. 40% of the employees try to go along with the organization policies. The other 40% might follow their assigned work group whereas the last 10% tend to take advantage of such circumstances just in case if degree of penalization is lower to that of the benefit and also risk of  getting caught is less.

7 0
3 years ago
Business behavior is derived in large part from the basic cultural environment in which the business operates and, as such, is s
solong [7]

Answer:

TRUE

Explanation:

The influence of cultural on business behavior is broadly encompassing. Cultural impacts ranges from understanding employee behavior and employees management methodologies; i.e. how best to manage employees based on their values and priorities. It also impacts the functional areas of marketing and distribution: what people appreciate and the peculiarities of their environment. It also greatly impact and is a strong determinant factor of success when a company is taking a decision on how best to enter a new market.

When business ignore cultural factors they are guilty of ethnocentrism and could be orchestrating business failure.

7 0
3 years ago
"Budget deficits should be avoided, even if the economy is below potential, because they reduce saving and lead to lower growth.
bixtya [17]

Answer:

the long-run framework directs one to avoid deficits; in the short-run framework deficits are useful if the economy is significantly below potential.

Explanation:

"Budget deficits should be avoided, even if the economy is below potential, because they reduce saving and lead to lower growth." This policy directive follow the long-run framework directs one to avoid deficits; in the short-run framework deficits are useful if the economy is significantly below potential.

<u>The reason is that in the short-run, deficits offer economic solutions by being an antidote to recessions, hence they could be a strategy of recession management in the short run</u>

<u>However in the long-run, deficits are not advisable as they could lead to debts because the major way to manage such deficits is by external borrowings. </u>

<u />

5 0
2 years ago
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow:
Orlov [11]

Answer: $54,000

Explanation:

Referring to the data regarding store operation given above, difference between cash receipt and cash disbursement for December could be calculated as follows;

December Cash receipt = (340,000*20%+320,000*80%) = 324,000

November Purchases = (340,000 × 75%)+(320,000 × 75% × 60%) - 153,000 = 246,000

December Cash payment = 246,000 +240,000 = 270,000

The difference between cash receipts and cash disbursement for December = 324,000 - 270,000 = 54,000

6 0
3 years ago
Read 2 more answers
Other questions:
  • Your sister's pet supplies business obtained a 30-year amortized mortgage loan for $250,000 at a nominal annual rate of 7.0%, wi
    5·1 answer
  • When an externality is present, the market equilibrium is a. efficient, and the equilibrium maximizes the total benefit to socie
    10·1 answer
  • Please Help!!!
    8·1 answer
  • Sharon is a 30-year-old stay-at-home mother to a toddler. life-span developmentalists would consider her to be:
    8·1 answer
  • Choose the best revision to the following sentence.A. While listening to the WebEx presentation, my computer speakers malfunctio
    7·1 answer
  • During the period, labor costs incurred on account amounted to $175,000, including $150,000 for production orders and $25,000 fo
    5·1 answer
  • An organization's investors and shareholders, employees, customers, and suppliers are considered its ____________, in contrast t
    10·1 answer
  • On December 31, the company provides consulting services and bills its customer $3,000 for these services.
    15·1 answer
  • What term describes a ban or restriction on trade with another country?
    10·2 answers
  • What is the source of mary’s portfolio income? mary trades in that involves buying and selling of stocks and mutual funds. she i
    7·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!