Acc372_hw5 - ACC372 INTERMEDIATE ACCOUNTING II(3 HOURS...

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ACC372 - INTERMEDIATE ACCOUNTING II (3 HOURS) Homework FIVE Chapter 14 c1. A company issues $5,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2010. Interest is paid on June 30 and December 31. The proceeds from the bonds are $4,901,036. Using effective-interest amortization, how much interest expense will be recognized in 2010? a. $195,000 b. $390,000 c. $392,124 d. $392,083 a2. A company issues $5,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2010. Interest is paid on June 30 and December 31. The proceeds from the bonds are $4,901,036. Using effective-interest amortization, what will the carrying value of the bonds be on the December 31, 2010 balance sheet? Use the following information to answer questions 3 and 4. On October 1, 2010 Macklin Corporation issued 5%, 10-year bonds with a face value of $1,000,000 at 104. Interest is paid on October 1 and April 1, with any premiums or discounts amortized on a straight-line basis. 3. The entry to record the issuance of the bonds would include a credit of
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