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
jekas [21]
2 years ago
12

Universal Foods issued 10% bonds, dated January 1, with a face amount of $176 million on January 1, 2021 to Wang Communications.

The bonds mature on December 31, 2035 (15 years). The market rate of interest for similar issues was 12%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. to 3. Prepare the journal entries to record the purchase of the bonds by Wang Communications on January 1, 2021, interest revenue on June 30, 2021 and interest revenue on December 31, 2028
Business
1 answer:
natima [27]2 years ago
5 0

Answer:

January 1, 2021

Dr Investment in bonds $176 million

Cr Discount in Investment in bonds $24,226,136

Dr Cash $151,773,864

June 30, 2021

Dr Cash $8,800,000

Dr Discount in Investment in bonds $897,538

Cr Interest Revenue $9,607,538

December 31, 2028

Dr Cash $8,800,000

Dr Discount in Investment in bonds $897,538

Cr Interest Revenue $9,607,538

Explanation:

1. to 3. Preparation of the journal entries to record the purchase of the bonds by Wang Communications on January 1, 2021, interest revenue on June 30, 2021 and interest revenue on December 31, 2028

January 1, 2021

Dr Investment in bonds $176 million

Cr Discount in Investment in bonds $24,226,136

($151,773,864-$176 million)

Dr Cash $151,773,864

(To record purchase of bonds)

June 30, 2021

Dr Cash $8,800,000

($176 million*10%/2)

Dr Discount in Investment in bonds $897,538

($24,226,136/30)

Cr Interest Revenue $9,607,538

($8,800,000+$897,538)

(To record Interest Revenue)

December 31, 2028

Dr Cash $8,800,000

($176 million*10%/2)

Dr Discount in Investment in bonds $897,538

($24,226,136/30)

Cr Interest Revenue $9,607,538

($8,800,000+$897,538)

(To record Interest Revenue)

Present value of an ordinary annuity of $1 n=30 I=6%

Present value of an ordinary annuity of $1 =13.76483

Present value of $1 n=30 I=6%

Present value of $1=0.17411

Interest ($176 million *5%*13.76483) $121,130,504

Principal ($176 million*0.17411) $30,643,350

=$151,773,864

You might be interested in
If an economy experiences increasing opportunity costs with respect to two goods, then the production possibilities curve betwee
umka2103 [35]

Production possibilities curve between the two goods will be a straight, downward-sloping line if the opportunity cost rise.

<h3>What is production possibilities curve?</h3>

The production possibilities curve serves as graph that display the relationship between the resources and the output that can be produced.

Therefore, when the opportunity cost that exists between two goods, there will be. downward slope as regards the production possibilities curve.

Learn more about production possibilities curve at;

brainly.com/question/2601596

#SPJ1

8 0
2 years ago
0.5 pts Congress has not allowed widespread work stoppages to occur in the railroad industry but has resolved disputes by enacti
iogann1982 [59]

Answer:

True or False

True - explanation below

Explanation:

The congress has been able to prevent the widespread stoppages because they have the power to enforce the emergency board recommendations. These recommendations were viewed by the parties to be very valuable and could definitely serve as the grounds for the resolutions of disputes that may arise.  

A one-day rail strike that happened in 1991 was resolved by the congress by enacting PUB L.102 -29 which was said to have the effects of imposing many of the recommendations of Presidential Emergency Board ( PEB) 219

4 0
3 years ago
What is the first step in setting up a budget? (1 point)
Bond [772]
Okay so, i don’t know, i’m so sorry.
6 0
3 years ago
Read 2 more answers
To motivate employees to perform better, the human resources department of Martianse, a chain of retail apparel stores, replaced
Lynna [10]

Answer:

- Behavioural Substitution

Explanation:

Martianse human resources department uses and deploy the concept of Behavioural Substitution.

To begin, Martianse goal, as a firm, is to motivate the employees to perform better. Hence, the human resources department has come up with measures to achieve that. It is thus believed that replacing the fixed incentive system hitherto known with the firm, should be replaced by a performance based system. By this, the firm believes its primary goal will be accelerated.

Behavioural Substitution is thus the concept that the human resources department has displayed in their analysis and engagement. For one, behavioural substitution is simply the procedures aimed at replacing and/or supplanting efforts and actions that does not lead to goal accomplishments. By general belief, the old style of reward system used by Martianse has been seen as one not leading to goal actualization. Hence, it is important to substitute this non productive reward system with one established to elicit more better and improved performance from the workforce.

7 0
3 years ago
After the amount due on a sale of $30,400, terms 2/10, n/eom, is received from a customer within the discount period, the seller
Elenna [48]

Answer:

a. The amount refund owed to the customer is : $29,792

b. To record the refund and the return of merchandise:

Dr Sales returned and Allowances     $30,400

Cr Sales Discounts                              $608

Cr Cash                                                $29,792

(to record the refund of $30,400 sales with sales discount of $608 made)

Dr Merchandise Inventory                    $13,060

Cr Cost of Merchandise sold               $13,060

(to record the impact of the $30,400 sales refund on cost of merchandise sold and merchandise inventory)

Explanation:

- Further explanation for sell discounts calculation:

As the terms is 2/10, total discount had been given as calculated below:

$30,400 x 2% = $608.

3 0
3 years ago
Other questions:
  • The average-marginal rule states: a. when the marginal magnitude is rising, the average magnitude must also be rising. b. when t
    6·1 answer
  • What is product market?
    5·1 answer
  • In the economy of​ Cycladia, the total unemployment rate is equal to 11.0 ​percent, the structural unemployment rate is 2.42.4 ​
    6·1 answer
  • During May, Camino Corp. purchased direct materials for 4,400 units at a total cost of $63,800. Camino’s standard direct materia
    13·1 answer
  • Westwick Inc. is an advertising agency. Its employees are allowed to take decisions and work in ways that will help maximize the
    13·1 answer
  • Working with people sometimes requires special techniques – what are some for graphic designer job?
    11·1 answer
  • WEEEEEEEEE IM GIVING OUT POINTS
    13·2 answers
  • One of the disadvantages of the Six Sigma approach compared to the Kaizen approach is that: Select one: a. the lack of ownership
    5·1 answer
  • 4. You want to take out a fully-amortizing 30-year mortgage. You can afford monthly payments of $600 each. The interest rate is
    6·1 answer
  • List three advantages of buying an existing business
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!