On January 1, 2023, Entity J issued $2,000,000 of 4% bonds with a five-year term....
60.1K
Verified Solution
Link Copied!
Question
Accounting
On January 1, 2023, Entity J issued $2,000,000 of 4% bonds with a five-year term. Interest is payable annually on January 1. The market interest rate was 6%. The issue price was $1,831,509. Entity J uses the effective interest method for amortization of bond discount or premium. What is the new carrying value of the bonds after the first interest accrual on December 31?
On January 1, 2023, Entity J issued $2,000,000 of 4% bonds with a five-year term. Interest is payable annually on January 1. The market interest rate was 6%. The issue price was $1,831,509. Entity J uses the effective interest method for amortization of bond discount or premium. What is the new carrying value of the bonds after the first interest accrual on December 31?
a. $1,861,400
b. $1,831,509
c. $3,000,000
d. $2,000,000
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: Flex AI - Your personal assistant for all your inquiries!
