Interest expense increases and payrnent ofprincipal

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Interest expense increases and payrnent ofprincipal decreases. Payment of principal increases and interest expense decreases. The proportion of interest expense to payment of principal remains the same. recorded on December 31, 2Al2 rs Bond interest is tax deductible for the corporation, whereas dividends paid are not a tax deductible expense of the corporation. @ r** W &o,b {*rr d*#,u*,4',"Aof*" lffi Fd** \*J The face value of the bond is the amount of principal and interest due at the maturitv date. A) True rfh Fuis* V O" Jel*9.y._L#12, $1,000,000, 10-year,Jp%baqds. were issued for $970,000. Interest is paid ?ffii-nnnr*#ly on June 30 an{D6-Cember 3l ' lf the issuing corporation uses the straight-hnE-iffit'ffi6 to amortize dishunt*tyn"bdffiti payabie, th* amp1lnSSLlEIereSL 14. dr' 6(, Ivttereet EKp $50,000. < $48,500. $100,000. $51,500. $s3,000 13 If $150,000 face H.f K k dr t- -PoYqPrl* df, Dlscor,n* W/(' I ?tlr) #fio P x s!'a,x T A) True @ uu'*" When a monthly rnortgage payment is made and recorded, the debit to Mortgage frgrable represents the reduction in the principal balance. \!) rrue B) False value bonds are issued at 103, ffi.mreceived witl be $103,000. v, (-f:
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E l5 A $400,000 bond was issued with a premium of $5,000 on January r, zarz. At the maturity date, in addition to the paying of interest, the issuer would pay back A) $40s.000 (P 1199,99? Fatn vafi*s ci $395,000 D) $o Football Company borrowed $750,000 from U.S. Bank on January 1, 2011 in order to expand its mining capabilities. The five-year note required annual payments af $195,327 and carried an annual interest rate of 9.5%o. What is the amount of expense Football must e"xp. D) S46,555 x a- Bo,ooo x .olv = 7t7vd t19fiT- ?t,>to> IrYo?+rz. Teop* -rlyrot?, fi il:,TXX-*" b>V,1>> A semiannual rate. ( Dil annual rate. blvrl>)Y .o1,9t Y quarterly rare. An interest rate is usually stated as a(n) recognized in December 31, 2}l2's entry is $7,160 $8,000 $8,840 $840. k A corporation issues $100,000, 8%o, 5-yearbonds on January l,z0r{" for $104,200 Interest is paid annually on December 3l)If the corporation uses;hAkarshtline method of amonization of bond discori( tire amornt ofNffiinterest paiFiS be v1ttu).;Y {o4t?Op Q?q*: Q F c-, '"' r n#{*t t'fif-' 19. Thq market rate of interest is often called the X stated rate.e..- -fs)) effective rate. \J L i coupon rate. inl contractual rate. If bonds sell at a discount,n"-0.6[It ;oftcognized each year will be greater than A bond interest paid. ==- ' - ( A)l True {} False f r,t CIffu-fr 1 il-Qaa; t
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Lnwnffi,X 2l' If one wanted to determine the amoua, 6"tQ company paid back this period, the easiest place to look would be: \--/ Ai Income Statement v Operating Activities Investing Activities Financing Activities A= +*u of $700 principal and $1300 interest. How much would {- "'r True alse -+ B), Balance Sheet C) - Statement of Cash Flows: ff Stut"*ent of Cash Flows: @ starement.f c;;h Fi;;; A mortgage payment consisted ^be tax deductible? fr)- szoo q3ffi3 23 Qontingent liabilities are ffiically found in the Statement of Cash Flows. ffi n.^--- 6 i;i:" \ r,rer .^%$n ,raaat ak-tery,44.s Arred taxes can be either an asset 25 ' During 2012, the BetterBuy Appliance Store sold ten refrigerators with a six month warranty' BetterBuy repaired one refrigerator on June z:r*lza:r .
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