Homework Quiz&acirc;€”4

# Homework Quizâ€”4 - Name: Homework Quiz4 1....

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Name: Section Homework Quiz—4 1. On May 1, 2010 GHI Company borrowed using a \$2,500,000, five–year bond with semiannual interest payments of 6%. The effective interest rate on the bond is 5% per six months. You have the following excerpts from time value of money tables: Future value single amount: Periods 5% 6% 5 1.27628 1.33823 10 1.62889 1.79085 Present Value of a single amount Periods 5% 6% 5 .78353 .74726 10 .61391 .55839 Future value of an ordinary annuity Periods 5% 6% 5 5.52563 5.63709 10 12.57789 13.18079 Present value of an ordinary annuity Periods 5% 6% 5 4.32948 4.21236 10 7.72173 7.36009 2a : In the space below write GHI’s entry to record issuance of these bonds on 5/1/10 2b : In the space below write the first three lines of GHI’s liability table for this bond. 1

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2c : In the space below write GHI’s entry to record interest expense for these bonds on 11/1/10 2d : In the space below write GHI’s entry to record the adjusting entry for these bonds on 12/31/10 2e : In the space below write GHI’s entry to record interest expense for these bonds on 5/1/11 2
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## This note was uploaded on 01/31/2011 for the course MGMT 351 taught by Professor Staff during the Spring '08 term at Purdue University.

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Homework Quizâ€”4 - Name: Homework Quiz4 1....

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