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horrorfan [7]
3 years ago
9

Presented below are two independent situations. a. George Gershwin Co. sold $2,000,000 of 10%, 10-year bonds at 104 on January 1

, 2020. The bonds were dated January 1, 2020, and pay interest on July 1 and January 1. If Gershwin uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2020, and December 31, 2020. by. Ron Kenoly Inc. issued $600,000 of 9%, 10-year bonds on June 30, 2020, for $562,500. This price provided a yield of 10% on the bonds. Interest is payable semi annually on December 31 and June 30. If Kenoly uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2020.
Business
2 answers:
ArbitrLikvidat [17]3 years ago
7 0

Answer:

Check the explanation

Explanation:

Bond cost 2000000

Bond discount 10%

Bond years 10

Bond yield 4%

Interest (Jan-June) 100000

Less: Premium Amortisation (4000) (2000000*0.04)/10 *6/12

Interest expense 96000

=========================

=========================

Bond cost 562500

Bond discount 9%

Bond years 10

Bond yield 10%

Interest (June 30-Oct 30) - ((1.10)^4/12) - 1=3.228%

Interest expense= 562500*3.228% =18157.5

andreev551 [17]3 years ago
6 0

Answer:

(a) Bond cost 2000000

Bond discount 10%

Bond years 10

Bond yield 4%

Interest (Jan-June) 100000

Less: Premium Amortisation (4000) (2000000*0.04)/10 *6/12

Interest expense 96000

(b) Bond cost 562500

Bond discount 9%

Bond years 10

Bond yield 10%

Interest (June 30-Oct 30) - ((1.10)^4/12) - 1=3.228%

Interest expense= 562500*3.228% =18157.5

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Paraphin [41]

Answer:

the cap rate is 6%

Explanation:

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3 years ago
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4 0
3 years ago
Item 1Item 1 Thomas invests $109 in an account that pays 6 percent simple interest. How much money will Thomas have at the end o
olga nikolaevna [1]

Answer:

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Explanation:

A simple interest account pays interest on only the sum deposited at an annual rate for a specified period of time without compounding or adding the interest earned in a particular period in the calculation of interest earning for the next period. Thus, if 1000 is invested and interest s earned at 10% then the interest earned will remain constant for every period the money is still deposited in the account.

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in 1 or 2 sentences identify a change (either increase or decrease) in supply or demand that would cause the equilibrium price t
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If Farmer Sam MacDonald can produce 200 pounds of cabbages and 0 pounds of potatoes or 0 pounds of cabbages and 100 pounds of po
mart [117]

Answer:

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