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ki77a [65]
3 years ago
7

Discount-Mart issued ten thousand $1,000 bonds on January 1, 2018. The bonds have a 10-year term and pay interest semiannually.

This is the partial bond amortization schedule for the bonds. Payment Cash Effective Interest Decrease in Balance Outstanding Balance 8,640,967 1 300,000 345,639 45,639 8,686,606 2 300,000 347,464 47,464 8,734,070 3 300,000 349,363 49,363 8,783,433 4 300,000 What is the interest expense on the bonds for the year ended December 31, 2019?
Business
1 answer:
guajiro [1.7K]3 years ago
5 0

Answer:

The interest rate of the bond issued it's 6%, so the company always pays the same amount of interest, $300,000 (3%) each period because it's semiannually, total year of $600,000.  

Explanation:

The difference lies on the rate interest accepted by the market, the information indicates that the market requires a higher interest rate to lend the money to the company at this moment.  

It the moment of the bond issued the company register:    

 Debit  $8,640,967  Cash  

 Debit  $1,359,033  Discount on Bonds Payable  

 Credit  $10,000,000  Bonds Payable  

   

At the moment of record the first interest payment    

 Debit  $345,639  Bond Interest Expense  

 Credit  $45,639          Discount on Bond Payable  

 Credit  $300,000  Cash  

   

At the moment of record the second interest payment    

 Debit  $347,464  Bond Interest Expense  

 Credit  $47,464          Discount on Bond Payable  

 Credit  $300,000  Cash  

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A rich singer has donated $450,846 to endow a university professorial chair in Bohemian Studies. If the money is invested at 12.
Sedaia [141]

Answer:

Annual withdrawal=  $57,032.02

Explanation:

Giving the following information:

Initial investment (PV)= $450,846

Interest rate (i)= 12.65%

<u>To calculate the annual withdrawal, we need to use the following formula:</u>

PV= Cf / i

Cf= annual cash flow

450,846= Cf / 0.1265

450,846*0.1265 = Cf

Cf= $57,032.02

7 0
3 years ago
Neil and Zack are working on a project that requires both research and presentation. Neil is better at research, so he gives the
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3 0
3 years ago
Read 2 more answers
Kirk Enterprises offers rug cleaning services to business clients. Below is the adjustments data for the year ended July 31.Adju
andreev551 [17]

Question Completion:

KIRK Enterprises

Trial Balance as of July 31:

Account Titles                   Debit        Credit

Cash                         36,000

Prepaid Insurance          12,000

Fees Receivable                            56,000

Supplies                         12,000

Equipment                60,000

Accumulated Depreciation               12,000

Unearned Revenue                         20,000

Accounts Payable                            32,000  

Common Stock                               84,000

Dividends                         4,000

Service Revenue                            80,000

Advertising Expense    28,000

Wage Expense             20,000      

Totals                          228,000   228,000

Required:

Using this information along with the spreadsheet below, record the adjusting entries in proper general journal form.

Answer:

Kirk Enterprises

                                        Unadjusted           Adjustments           Adjusted

                                       Trial Balance                                      Trial Balance

Account Titles               Debit     Credit    Debit   Credit       Debit       Credit

Cash                       36,000                                               36,000

Prepaid Insurance        12,000                             3,000          9,000

Fees Receivable       56,000                                              56,000

Supplies                       12,000                             4,000          8,000

Equipment              60,000                                              60,000

Accumulated Depreciation       12,000                1,000                        13,000

Unearned Revenue                  20,000     15,000                                 5,000

Accounts Payable                     32,000                                                32,000

Wages Payable                                                    2,000                         2,000

Common Stock                        84,000                                                 84,000

Dividends                       4,000                                               4,000

Service Revenue                     80,000              15,000                       95,000

Advertising Expense  28,000                                             28,000

Wage Expense           20,000                   2,000                22,000

Insurance Expense                                    3,000                  3,000

Supplies Expense                                      4,000                  4,000

Depreciation Expense                               1,000                   1,000      

Totals                       228,000 228,000 25,000 25,000 231,000  231,000

Explanation:

a) Adjustments:

Depreciation expense $1,000 Accumulated Depreciation $1,000

Wages expense $2,000 Wages payable $2,000

Supplies expense $4,000 Supplies $4,000 ($12,000 - $8,000)

Unearned revenue $15,000 Service Revenue $15,000 ($20,000 * 75%)

Insurance expense $3,000 Prepaid Insurance $3,000 ($12,000 - 9,000)

5 0
2 years ago
Croft Corporation produces a single product. Last year, the company had a net operating income of $89,000 using absorption costi
Maksim231197 [3]

Answer:

21,200 units

Explanation:

For determining the sales, first we have to compute the net operating income difference which is shown below:

= Net operating income under absorption costing - Net operating income under variable costing

= $89,000 - $74,600

= $14,400

Now the inventory units increased by

= $14,400 ÷ 12 per unit

= 1,200 units

And, the production units are 22,400

So, the sales would be

= 22,400 units - 1,200 units

= 21,200 units

This is the answer and the same is not provided in the given options

4 0
2 years ago
At the beginning of the school year, Craig Kovar decided to prepare a cash budget for the months of September, October, November
Naddika [18.5K]

Answer:

The answer is attached for ease of understanding and reference.

Explanation:

Download xlsx
5 0
3 years ago
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