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fomenos
2 years ago
7

Hill Corporation issued $2,100,000 of 8% bonds at 98 on January 2, 2019. Interest is paid semiannually on June 30 and December 3

1. The bonds had a 10-year life from the date of issue, and the company uses the straight-line method of amortization. On March 31, 2022, Hill recalls the bonds at the call price of 107 plus accrued interest.
Required:
Prepare the journal entries to record the reacquisition (recall) of Hill's bonds.
Business
1 answer:
Butoxors [25]2 years ago
5 0

Answer:

Hill Corporation

Journal Entries

March 31, 2022:

Debit Bond Liability $2,247,000

Debit Interest Payable $42,000

Credit Cash $2,289,000

To record the recall of the bonds, including accrued interest.

Explanation:

a) Data and Calculations:

January 2, 2019: Face value of bonds issued = $2,100,000

Proceeds from the issue of the bonds at 98 =    2,058,000

Discount from the issue =                                        $42,000

Semi-annual amortization under straight-line = $2,100 ($42,000/20)

Coupon interest rate = 8% with payment made semiannually

Annual interest payment = $168,000 ($2,100,000 * 8%)

Semiannual interest payment = $84,000 ($2,100,000 * 4%)

Bonds duration = 10 years

March 31, 2022 Recall price of 107 = $2,247,000

Accrued interest from January 1 to March 31 = $42,000

Total payment to bondholders = $2,289,000

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3 years ago
Consider the following limit-order book for a share of stock. The last trade in the stock occurred at a price of $52. Limit Buy
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$52.25

Explanation:

From the question given, thus saying if a market buy order for 100 shares comes in, at what price will it be filled.

(a) The price it will be filled is at  $52.25

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3 years ago
Yurman Co. sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or th
vekshin1

Answer:

b. $660,000.

Explanation:

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3 years ago
What is a demand relationship?
NeX [460]

Answer:

Demand relationship is the relationship between the dominant prices of a good and the quantity that will be bought at that price.

Explanation:

Demand can be defined as the quantity of a good that consumers are ready to purchase at different prices at a given period of time.

The basic demand relationship is between potential prices of a good and the quantities that would be bought at those prices. The relationship is always a negative one, this implies that an increase in price will lead to a decrease in the quantity demanded. This negative relationship is represented in the downward slope of the consumer demand curve. Take for instance, if the price of a bag of rice rises from $10 to a price of $20, this is a huge price increase. This increase forces the consumer to demand less of that product at the price of $20 because the new price is more expensive and also very unreasonable for a bag of rice.

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3 years ago
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mafiozo [28]

Answer:

(a) Dollar Weighted Rate of return = 0.27

(b) Simple interest-based rate of return = (115000- 100000)/ 100000 = 0.15

(c) Since, the data or investment portfolio of Emily is of one year, we can calculate the money weighted rate of return but time weighted rate of return couldn’t be calculated.

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For (a) Dollar Weighted Rate of return = 0.27

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So, using calculator we found r= 0.27  

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For (b) Simple interest-based rate of return = (115000- 100000)/ 100000 = 0.15  

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(c) Since, the data or investment portfolio of Emily is of one year, we can calculate the money weighted rate of return but time weighted rate of return couldn’t be calculated.

4 0
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