ch14_ins NIU F11 stu - Chapter 14-1 C H A P T E R C H A P T...

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Unformatted text preview: Chapter 14-1 C H A P T E R C H A P T E R 14 14 LONG-TERM LIABILITIES LONG-TERM LIABILITIES Intermediate Accounting 13th Edition Kieso, Weygandt, and Warfield Chapter 14-2 Lear ning Objectives Lear ning Objectives 1. Descr ibe the formal procedures associated with issuing long- term debt. 2. I dentify var ious types of bond issues. 3. Descr ibe the accounting valuation for bonds at date of issuance. 4. Apply the methods of bond discount and premium amor tization. 5. Descr ibe the accounting for the extinguishment of debt. 6. Explain the accounting for long-term notes payable. 7. Explain the repor ting of off-balance-sheet financing arrangements. 8. I ndicate how to present and analyze long-term debt. Chapter 14-3 Bonds Payable Bonds Payable Long-Term Notes Long-Term Notes Payable Payable Reporting and Reporting and Analyzing Analyzing Long-Term Debt Long-Term Debt Issuing bonds Issuing bonds Types and ratings Types and ratings Valuation Valuation Effective-interest Effective-interest method method Costs of issuing Costs of issuing Extinguishment Extinguishment Notes issued at face Notes issued at face value value Notes not issued at Notes not issued at face value face value Special situations Special situations Mortgage notes Mortgage notes payable payable Off-balance-sheet Off-balance-sheet financing financing Presentation and Presentation and analysis analysis Long-Term Liabilities Long-Term Liabilities Chapter 14-4 Bonds Payable Bonds Payable Long-term debt consists of probable future sacrifices of economic benefits arising from present obligations that are not payable within a year or the operating cycle of the company, whichever is longer. LO 1 Describe the formal procedures associated with issuing long-term debt. Examples: Bonds payable Notes payable Mortgages payable Pension liabilities Lease liabilities Long-term debt has various covenants or restrictions . Chapter 14-5 I ssuing Bonds I ssuing Bonds LO 1 Describe the formal procedures associated with issuing long-term debt. Bond contract known as a bond indenture . Represents a promise to pay: (1) sum of money at designated maturity date, plus (2) periodic interest at a specified rate on the maturity amount (face value). Paper certificate, typically a $1,000 face value. Interest payments usually made semiannually. Purpose is to borrow when the amount of capital needed is too large for one lender to supply. Secured bonds : backed by a pledge of some sort of collateral. Mortgage bonds are secured by a claim on real estate. Collateral trust bonds : secured by stocks and bonds of other corporations. Bonds not backed by collateral are unsecured....
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ch14_ins NIU F11 stu - Chapter 14-1 C H A P T E R C H A P T...

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