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Accounting for Notes Issues at a Premium The Longo Corporation issued $50 million maturity value...

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Finance

Accounting for Notes Issues at a Premium

The Longo Corporation issued $50 million maturity value of six percent coupon rate notes, with interest paid semiannually. At the time of the note issuance, equivalent risk-rated debt instruments carried a yield rate of four percent. The notes matured in five years.

Calculate the proceeds that the Longo Corporation would receive from the sale of the notes. Round your answer to the nearest dollar.

$Answer

How will the notes be reported on Longos balance sheet immediately following the sale? Round your answers to the nearest dollar.

Bonds payable $Answer
Plus: Bond Premium $Answer
Book Value $Answer

Calculate the interest expense on the notes for the first year. Round answers to the nearest dollar.

First six months $Answer
Second six months $Answer

Calculate the book value of the notes at the end of the first year. Round answer to the nearest dollar.

$Answer

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