2007 - Ch 17 - Ch 17 E17-3 Stated interest rate = Effective...

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Ch 17 E17-3 12% 10% 186,276 $ 136,468 ------------- 322,744 $ ======= YEAR INTEREST AMORTIZED REVENUE CASH COST 1/1/2006 322,744 EO 06 32,274 36,000 319,019 EO 07 31,902 36,000 314,921 EO 08 31,492 36,000 310,413 EO 09 31,041 36,000 305,454 EO 10 30,545 36,000 300,000 ----------- ----------- 157,255 180,000 ======= ======= E17-4 Stated interest rate = 12% Effective interest rate 10% Issue price on 1/1/06: PV of principal = $300,000 x PVSA (5,10%) = $300,000 x .62092 = PV of interest = $36,000 x PVOA (5,10%) = $36,000 x 3.79079 = YEAR INTEREST AMORTIZED FAIR UHG/L REVENUE CASH COST VALUE (given) 1/1/2006 322,744 322,744 EO 06 32,274 36,000 319,019 320,500 (1,482) Gain EO 07 31,902 36,000 314,921 309,000 7,402 Loss EO 08 31,492 36,000 310,413 308,000 (3,508) Gain EO 09 31,041 36,000 305,454 310,000 (6,959) Gain EO 10 30,545 36,000 300,000 300,000 4,545 Loss ----------- ----------- (1) Rounding Error 157,255 180,000 ======= ======= Date Dr Cr A) Jan-06 Available for Sale Securities 322,744 Cash 322,744 B) Dec-06 Cash 36,000 Available for Sale Securities 3,726 Interest Revenue 32,274 C) Dec-06 Unrealized Holding Gain/Loss 1,482 Available for Sale Securities 1,482 Dec-07 AFS Securities 7,402 Unrealized Holding Gain/Loss 7,402 Sale of AFS Jan-08 Cash 309,000 Realized Loss on Sale 5,920 AFS Securities 309,000 UHG/L 5,920 Account Additional Info Effective interest rate Stated interest rate = Issue price on 1/1/06: PV of interest = $36,000 x PVOA (5,10%) = $36,000 x 3.79079 = PV of principal = $300,000 x PVSA (5,10%) = $300,000 x .62092 = 136,468 186,276 $ ======= 322,744 $ ------------- Page 1 of 5
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Ch 17 E17-7 Dr Cr A) UHG/L - [NI] 1,400 Trading Securities 1,400 B) Cash 9,400 AFS - Trading Securities 9,000 Realized Gain on Sale 400 C) NJE Effect on Net Income (1,000) Cost FV UHG/L - 06 FV UHG/L - 07 Inv. Rev Clemson 20,000 19,000 (1,000) 19,100 (900) Colorado 10,000 9,000 (1,000) 400 9,400 Buffalo 20,000 20,600 600 20,500 500 (1,400) (1,400) E17-13 1,000,000 110,000 44,000 1,066,000 1,000,000 1,000,000 110,000 110,000 44,000 44,000 A) 110,000 $ B) 44,000 $ C) 440,000 $ D) 176,000 $ 110,000 $ 44,000 $ E17-16 Jaycie Phelps Inc Shares % of Company Par Value Total Investment Net Income DPS 50,000 20% $24 $730,000 $0.85 Fair Value of Share
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2007 - Ch 17 - Ch 17 E17-3 Stated interest rate = Effective...

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