4.Quiz4Sol - Churchill Inc. uses the straight-line method...

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ADM3340A Fall 2008 Quiz #4 Suggested Solution Question 1 On March 1, 2008 Churchill Inc. issues $1,000,000 face value bonds. The bond date is February 1, 2008 and the bonds carry a coupon rate of 8% per year, payable annually on January 31. The bonds' maturity date is February 1, 2014. Proceeds upon issuance, excluding accrued interest, were $1,097,171, and the bonds provide an annual yield of 6%.
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Unformatted text preview: Churchill Inc. uses the straight-line method to amortize any bond premium or discount. On October 30, 2011 Churchill Inc. retires 100% of the bonds at 101%, excluding accrued interest. Churchill Inc.'s accounting year-end is August 31. Provide the journal entry to record the retirement of the bonds. Show all supporting calculations....
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This note was uploaded on 01/07/2010 for the course ACCOUNTING adm3340 taught by Professor Collier during the Fall '09 term at University of Ottawa.

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