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
kodGreya [7K]
3 years ago
13

A corporation issues $92,000, 8%, 5-year bonds on January 1, for $96,140. Interest is paid semiannually on January 1 and July 1.

If the corporation uses the straight-line method of amortization of bond premium, determine the amount of bond interest expense to be recognized on July 1.
Business
1 answer:
PilotLPTM [1.2K]3 years ago
5 0

Answer:

$3,266

Explanation:

First we must calculate the total amount received as bond premium:

$96,140 - $92,000 = $4,140

This should be amortized over 10 periods (= 5 years x 2 semiannual payments), so we must amortize $414 per period.

The coupon that the company pays = $92,000 x 8% x 1/2 = $3,680

So the interest to be recognized is = $3,680 - $414 = $3,266

You might be interested in
Support this statement using complete sentences: “Constructive criticism is offered in a way that encourages growth and learning
Reil [10]
<span>Constructive criticism encourages growth and learning by being positive and encouraging, offering solutions to problems, targeting specific areas for improvement and by being expressed only in private.</span>
8 0
3 years ago
Five years ago, Tom loaned his son John $20,000 to start a business. A note was executed with an interest rate of 8%, which is t
Citrus2011 [14]

Answer:

The answer is: B) $3,000 deduction

Explanation:

Tom can make only a $3,000 deduction this year since this loss qualifies as a capital loss. He doesn't have any capital gains to offset this loss. Therefore this year he is limited to make a $3,000 deduction against ordinary income and the remainder must be carried over to subsequent years.

6 0
3 years ago
The two-year interest rate is 10% and the expected annual inflation rate is 5%.
vesna_86 [32]

In economics, the Fisher equation is used to determine the relationship of the nominal interest rate and the real interest rate. This equation takes into account the effect of inflation. Mathematically this is expressed as:

Real rate = \frac{1+Nominal rate}{1+Inflation} -1

The values given are:

Nominal rate= 10% = 0.1

Inflation=5%=0.05

Substituting known values and by calculation:

<span>Real rate=0.0476 = 4.76%</span>


7 0
3 years ago
PLEASE HELP WILL MARK AS BRAINLIEST ITS URGENT
julia-pushkina [17]
Okay what’s the problem
8 0
3 years ago
On January 1, Greene Inc. issued $5,000,000, 9% bonds for $4,685,000. The market rate of interest for these bonds is 10%. Intere
skad [1K]

Answer:

b.$296,500.

Explanation:

Calculation to determine what Greene should report as unamortized bond discount

First step is to calculate the discount amount

Discount Amount= ($5,000,000 × .09) - ($4,685,000 × .10)

Discount Amount= $18,500

Now let determine the unamortized bond discount

Unamortized bond discount=$315,000 - $18,500 Unamortized bond discount= $296,500

Therefore Greene should report unamortized bond discount of $296,500

5 0
3 years ago
Other questions:
  • Does USAMS cable support fast charging?
    13·2 answers
  • Assume a zero-coupon bond that sells for $270 and will mature in 25 years at $1,850. Use Appendix B for an approximate answer bu
    10·1 answer
  • Nelson, a minor, misrepresents his age when agreeing to a contract to buy a restored, antique soda vending machine from old is n
    6·1 answer
  • Briefly describe variable, fixed, mixed, and step costs, and indicate how the total cost function of each changes as activity in
    9·1 answer
  • Which answer is true?
    6·2 answers
  • When pooling variances, the resulting value will be closer to the variance for the sample with the smaller number of scores.​?
    8·2 answers
  • Which leadership style best describes this Spider-Man? Why?
    5·1 answer
  • CORRECT ANSWERS ONLY!
    7·1 answer
  • Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of
    12·1 answer
  • Which type of ma plan is an hmo plan that also covers some benefits out-of-network, generally at a higher cost?.
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!