Chapter 10 Solutions - Jordan Kirkey ACC 212 20 Chapter 10 Exercises and Problems Exercises 10-1 1 Semiannual cash interest payment = $3,400,000 x

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Jordan Kirkey ACC 212 20 Chapter 10 Exercises and Problems Exercises 10-1 1. Semiannual cash interest payment = $3,400,000 x 9% x 1/2 = $153,000 2. Journal entries 2008 (a) Jan. 1 Cash. 3,400,000 Bonds Payable 3,400,000 (b) June 30 Bond Interest Expense. 153,000 Cash 153,000 (c) Dec. 31 Bond Interest Expense. 153,000 Cash 153,000 3 . 2008 (a) Jan. 1 Cash 3,332,000 Discount on Bonds Payable 68,000 Bonds Payable 3,400,000 (b) Jan. 1 Cash 3,468,000 Premium on Bonds Payable 68,000 Bonds Payable 3,400,000 10-2 1. Discount = Par value - Issue price = $180,000 - $170,862 = $9,138 2. Six payments of $7,200 $ 43,200 Plus discount 9,138 Total bond interest expense $52,338
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3. Straight-line amortization table ($9,138/6 = $1,523) Semiannual Unamortized Carrying Period-End Discount Value (0) 1/01/2008 $9,138 $170,862 (1) 6/30/2008 7,615 172,385 (2) 12/31/2008 6,092 173,908 (3) 6/30/2009 4,569 175,431 (4) 12/31/2009 3,046 176,954 (5) 6/30/2010 1,523 178,477 (6) 12/31/2010 0 180,000 10-3 B 1. Discount = Par value - Issue price = $500,000 - $463,140 = $36,860
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This homework help was uploaded on 04/03/2008 for the course ACC 212 taught by Professor Stovall during the Spring '08 term at Grand Valley State University.

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Chapter 10 Solutions - Jordan Kirkey ACC 212 20 Chapter 10 Exercises and Problems Exercises 10-1 1 Semiannual cash interest payment = $3,400,000 x

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