Matthew_McCoy_Problem 14-6A

Matthew_McCoy_Problem 14-6A - Discount (0) 1/1/2009 12,112...

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Matthew McCoy Problem 14-6A 2009 Jan. 1 Cash 332,888 Discount on Bonds Payable 12,112           Bonds Payable      Sold bonds at a discount on their issue date. Interest Computations Amount repaid to bondholders    Eight interest payments of 8,625 69,000    Par value at maturity 345,000    Total repaid to bondholders 414,000 Less amount borrowed from bondholders (332,888) Total bond interest expense 81,112                      Bonds: $345,000 Par Value, Semiannual Interest Payments, Four-Year Life,                                      2.5% Semiannual Contract Rate, 3% Semiannual Market Rate (A) (B) ( C) (D) Semiannual Cash Bond Interest Interest Interest Discount Unamortized Period-End Paid Expense Amortization
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Unformatted text preview: Discount (0) 1/1/2009 12,112 (1) 6/30/2009 8,625 9,987 1,362 10,750 (2) 12/31/2009 8,625 10,028 1,403 9,347 (3) 6/30/2009 8,625 10,070 1,445 7,902 (4) 12/31/2009 8,625 10,113 1,488 6,414 2009 Jun. 30 Bond Interest Expense 9,987 Discount on Bonds Payable Cash To record semiannual interest and discount amortization (effective interest method). Dec. 31 Bond Interest Expense 10,028 Discount on Bonds Payable Cash To record semiannual interest and discount amortization (effective interest method). 345,000 (E) Carrying Value 332,888 334,250 335,653 337,098 338,586 1,362 8,625 1,403 8,625...
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This note was uploaded on 09/24/2011 for the course ACCT 212 taught by Professor Sheik during the Spring '11 term at Mountain State.

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Matthew_McCoy_Problem 14-6A - Discount (0) 1/1/2009 12,112...

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