Chap014 - Student Name: Instructor Class: McGraw-Hill/Irwin...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 14-03 Requirement 1: BRADLEY RECREATIONAL PRODUCTS Amortization Table at Effective Interest Rate Cash Effective Increase in Outstanding Pay- Interest Interest Balance Balance ment 4.5% 5% 96,768 1 4,500 4,838 338 97,106 2 4,500 4,855 355 97,461 3 4,500 4,873 373 97,834 4 4,500 4,892 392 98,226 5 4,500 4,911 411 98,637 6 4,500 4,932 432 99,069 7 4,500 4,953 453 99,522 8* 4,500 4,978 478 100,000 36,000 39,232 3,232 *rounded Correct! Correct! Correct! Requirement 2: BRADLEY RECREATIONAL PRODUCTS Amortization Table Straight-Line Method Cash Recorded Increase in Outstanding Pay- Payment Interest Balance Balance ment 4.5% 100,000 96,768 1 4,500 4,904 404 97,172 2 4,500 4,904 404 97,576 3 4,500 4,904 404 97,980 4 4,500 4,904 404 98,384 5 4,500 4,904 404 98,788 6 4,500 4,904 404 99,192 7 4,500 4,904 404 99,596 8 4,500 4,904 404 100,000 36,000 39,232 3,232 Correct! Correct! Correct! Requirement 3: BRADLEY RECREATIONAL PRODUCTS General Journal Account Debit Credit (effective interest) Interest expense 4,911 «- Correct! Discount on bonds payable 411 Cash 4,500 (straight-line) Interest expense 4,904 «- Correct! Discount on bonds payable 404 Cash 4,500
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Given Data P14-03: BRADLEY RECREATIONAL PRODUCTS Bond issue $100,000 Bond issue - term (years) 4 Bond issue - interest rate 9% Bond annual rate of return 10% Bonds issued at $96,768
Background image of page 2
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 14-05 Requirement 1: Cromley Motor Products Interest $23,267,556 Principal 54,147,200 Present value (price) of the bonds $77,414,756 «- Correct! Requirement 2: CROMLEY MOTOR PRODUCTS Amortization Schedule Cash Effective Payment Interest Increase in Outstanding 4.5% 5% Balance Balance 77,414,756 1 3,600,000 3,870,738 270,738 77,685,494 2 3,600,000 3,884,275 284,275 77,969,769 3 3,600,000 3,898,488 298,488 78,268,257
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 12/02/2010 for the course ACCT 211 taught by Professor Frech during the Spring '10 term at Benedictine IL.

Page1 / 11

Chap014 - Student Name: Instructor Class: McGraw-Hill/Irwin...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online