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elixir [45]
3 years ago
10

Jones Company issued $500,000 of 5%, 10-year bonds payable at a price of 92. The market interest rate on the date of issuance wa

s 6%, and the bonds pay interest semiannually. The journal entry to record the first semiannual interest payment using the effective interest amortization method is:
Business
1 answer:
Daniel [21]3 years ago
5 0

Answer:

Date                     Account Title                                       Debit              Credit

XX-XX-XXXX       Interest expense                               $13,800

                            Discount on bond payable                                        $1,300

                            Cash                                                                           $12,500

Working      

The bonds were issued at a price of 92 which means they were issued at:

= 500,000 * 96/100

= $460,000

Interest expense

= Issue price * interest rate * 6/12 months

= 460,000 * 6% * 6/12

= $13,800

Cash:

= Bond price * coupon rate * 6/12

= 500,000 * 5% * 6/12

= $12,500

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Emerald Co. uses a perpetual inventory system and records purchases of merchandise at net cost. The company recently purchased 2
Aneli [31]

Answer:

Dr accounts payable   $2,300

Cr cash                                      $2300

Explanation:

Initially the cost of the purchases=$4600

Returning half of the disc means the left for the discs actually bought is half of the invoice price of $4600 i.e $2,300

By not paying within the discount period implies that the debt stands at $2,300

Without mincing words,payment of $2,300 to the supplier automatically translates to debiting account payable with $2,300 and crediting cash account with the same amount.

The correct answer would :

Dr accounts payable   $2,300

Cr cash                                      $2300

This is missing from the options provided.

3 0
2 years ago
Look in a recent issue of The Wall Street Journal at "NYSE-Composite Transactions."a. What is the latest price of IBM stock? b.
nydimaria [60]

Answer:

A) $191.08

B)  The annual dividend = $0.85 per share

     dividend yield = 1.78%

C) 3.14%

D) 13.74

E) $13.91

F) IBM's P/E  at 13.74 is higher than Exxon Mobil P/E at 11.29

G) The possible reasons for the difference in P/E is due to the difference in EPS earned by each company and also the difference in stock price of each company's stock

Explanation:

Referring the the recent issue of the wall street Journal at NYSE-Composite Transactions

A) The Latest price of IBM stock = $191.08

B)  What are the annual dividend payment and the dividend yield on IBM stock

The annual dividend = $0.85 per share

dividend yield = 1.78%

C) calculate what the yield will become if yearly dividend is moved up to $1.50

first we find the price per share

price per share = annual dividend per share / current dividend yield

                         = 0.85 / 1.78%  = 0.85 / 0.0178 = $47.75

since we now have the price per share value we can now calculate the dividend yield

dividend yield = annual dividend / price per share

                       = $1.50 / $47.75 =  0.0314

                       = 3.14 %

D) Calculate the P/E on IBM stock

 = 13.74 times as it was traded for the last 12 months

E) calculate IBM's earnings per share using P/E

 earnings per share = Price / P/E

 Latest  price of IBM stock = $191.08

  P/E = 13.74

 earnings per share =  191.08 / 13.74  = $13.91

F) IBM's P/E  at 13.74 is higher than Exxon Mobil P/E at 11.29

G) The possible reasons for the difference in P/E is due to the difference in EPS earned by each company and also the difference in stock price of each company's stock

7 0
3 years ago
How does a bond sale by the fed affect the money supply?
kumpel [21]
A bond sale is a debt investment that is given by an investor to a particular corporate or governmental entity and is payable over a period of time at a variable or a fixed interest rate. It can affect the money supply, or the money of the country, because it encourages debtors to keep loaning from the government to finance their personal interests.
4 0
2 years ago
Read 2 more answers
_____ are dedicated to promoting human behaviors and industry decisions that are environmentally responsible.
ElenaW [278]
Green careers ...................
7 0
3 years ago
Read 2 more answers
Corporate blogs are easy to maintain because they do not require in-depth writing or monitoring of comments.​ True False
Hoochie [10]

The answer to this question is FALSE. Corporate blogs are not easy to maintain because in making business blogs time is always needed especially in having a schedule in posting frequently in the blog. Corporate blogs can be external or internal blogs. External blogs are blogs that are available in the public to see and interact while Internal blogs are blogs within the company organization use only. 

3 0
3 years ago
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