Quiz chap14 - Instructions Calculate the total dollar...

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Quiz Chapter 14 Accounting 3312 Spring2011 Name: __________________________ Lowry Co. issued $500,000 of 10% debentures on May 1, 2010 and received cash totaling $586,460. The bonds pay interest semiannually on May 1 and November 1. The maturity date on these bonds is May 1, 2025. The firm uses the effective-interest method of amortizing discounts and premiums. The bonds were sold to yield an effective-interest rate of 8%.
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Unformatted text preview: Instructions Calculate the total dollar amount of discount or premium amortization during the first year (5/1/10 through 4/30/11) these bonds were outstanding. (Show computations and round to the nearest dollar.) date 10%(10%/2)cash paid 8%(8%/2) Premium Carrying amount May1,2010 $ 586,460 Nov.1 2010 25000 $ 23,458.41 $ 1,541.59 $ 584,919 May1,2011 25000 $ 23,396.74 $ 1,603.26 $ 583,315 Page 1...
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This note was uploaded on 03/27/2012 for the course ACCT 3312 taught by Professor Staff during the Spring '08 term at Texas A&M University, Corpus Christi.

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