Subject : Accounting 1) Hoes houses issued a $10,000,000, 20-year 8% bond with semi-annualinterest payments. Calculate the following three items:a. The semi-annual interest payments.b. The issue price if market rate when it was issued was 7.25%c. The issue price if the market rate when it was issued was 8%2) LOL CO issued a 5-year, 12% bond of $10,000,000. Interestpayments are made annually. It was issued to yield 11%.a. Calculate the issue price of the bond.b. Prepare the amortization table for the full life of the bond.c. Prepare the journal entries for the issuance of the bond, the firstinterest payment, the final interest payment, and the retirement of thebond.

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1) Hoes houses issued a $10,000,000, 20-year 8% bond with semi-annual interest payments. Calculate the following three items: a. The semi-annual interest payments. b. The issue price if market rate when it was issued was 7.25% c. The issue price if the market rate when it was issued was 8%

1) Hoes houses issued a $10,000,000, 20-year 8% bond with semi-annual interest payments. Calculate the following three items: a. The semi-annual interest payments. b. The issue price if market rate when it was issued was 7.25% c. The issue price if the market rate when it was issued was 8%

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 15MCQ

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Question

Subject : Accounting

1) Hoes houses issued a $10,000,000, 20-year 8% bond with semi-annual
interest payments. Calculate the following three items:
a. The semi-annual interest payments.
b. The issue price if market rate when it was issued was 7.25%
c. The issue price if the market rate when it was issued was 8%
2) LOL CO issued a 5-year, 12% bond of $10,000,000. Interest
payments are made annually. It was issued to yield 11%.
a. Calculate the issue price of the bond.
b. Prepare the amortization table for the full life of the bond.
c. Prepare the journal entries for the issuance of the bond, the first
interest payment, the final interest payment, and the retirement of the
bond.

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