Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. entries for issuing bonds and amortizing premium b

Entries for issuing bonds and amortizing premium by straight-line method Smiley Corporation wholesales...

50.1K

Verified Solution

Question

Accounting

Entries for issuing bonds and amortizing premium by straight-line method
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1,20Y1, Smiley issued $4,900,000 of 6-year, 9% bonds at a market (effective) interest rate of 6%, receiving cash of $5,631,619. Interest is payable semiannually on April 1 and October 1.
a. Journalize the entry to record the issuance of bonds on April 1,20Y1. If an amount box does not require an entry, leave it blank.
b. Journalize the entry to record the first interest payment on October 1,20Y1, and amortization of bond premium for 6 months, using the straight-line method. Round to the nearest dollar. If an amount box does not require an entry, leave it blanir.
c. Why was the company able to issue the bonds for $5,631,619 rather than for the face amount of $4,900,000?
The market rate of interest is the contract rate of interest.
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Design a mod 5 counter as a (a) synchronous circuit (b) asynchronous circuit

Electrical Engineering
Q

For a signal x(n)=sin(2*pi*n/5) defined for n=0to7, evaluate the Fast Fourier Transform using signal flow graph....

Electrical Engineering
Q

8 Which is one example of artificial active immunization a Immune response to a pathogen...

Biology
Q

7. Solve the exponential equations. Round to 4 decimal places when necessary.a)81^2x=27^2x-5b) 4000 = 200e^8xc)...

Basic Math
Q

2 1 10 2 A 3 B 232 4 1 a A 2B and A...

Basic Math
Q

6 8C6

Calculus
Q

3 2 7 2 points for correct work shown 1 point for the correct answer...

Algebra
Q

HELP!!! PLEASE HELP!!! I need to solve all the orange spaces, the blue is the...

Accounting
Q

Equipment costing $24,400 with a book value of $9,700 is sold for $6,800. Which journal...

Accounting
Q

Please answer all parts ADTF Distributors is opening...

Accounting
Q

I am having a hard time with the adjusting entries, any help would be apprciated....

Accounting
Q

please answer using excel or a table like as seen in picture !!!!!!! ...

Accounting