Claremont Inc. issued a $400,000 bond on January 1, 2020. The bond had a five-year life and an 8% stated rate of interest. The bond contract requires Claremont to pay semiannual dividends each June 30 and December 31. The market rate of interest on January 1, 2020 when Claremont issued the bond was 6%.   Required: 1. Use Excel to determine the cash proceeds from the bond issue on January 1, 2020. 2. Use Excel to construct a bond amortization table for the five-year life of the bond. 3. Record the journal entries for the bond in 2020. 4. Report the effects of the bond on the 2020 income statement and cash flows statement and the balance sheet on December 31, 2020

Q: On January 1, 2020, MNOCompany issued its 9%, P2 million bonds, which mature on January 1, 2030. The…

A:

Q: On January 1, 2019, W Sport Corporation issued 10% bonds with a face value of $200,000. The bonds…

A: Bond interest: Bond interest is the interest payment that to be made to bond Holder. Generally a…

Q: On January 1, 2018, Quinton Corporation issued 8% bonds with a face value of $100,000. The bonds are…

A:

Q: On January 1, 2021, Surreal Manufacturing issued 540 bonds, each with a face value of $1,000, a…

A: Bond Amortization Schedule Period Ended Changes during the period Ending bond liability balances…

Q: On January 2, 2021, Santos Company invested in a 4-year, 10% bond with face value of P6,000,000 in…

A: Financial statements refer to the written form of a statement of a company that depicts its…

Q: On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable…

A: Bonds: Bonds are a kind of interest bearing notes payable, usually issued by companies, universities…

Q: On July 1, 2020, Shake Corporation issued its 10%, 7-year bonds with one detachable warrant attached…

A: solution : the issued instrument is a compound financial instrument We shall identify the financial…

Q: On January 1,2019, ABC Corporation issued a 5-year, 12%, 1,000 of the P 5,000 face value bonds with…

A: market value of bond= present value of future payments@YTM

Q: ABC Corporation is authorized to issue P5,000,000 of 6%, 10-year bonds dated July 1, 2020, with…

A: Bonds payable are one of the sources of finance and are shown as liability. If the interest rate is…

Q: On March 1, 2020, Jackson issues 5-year bonds, dated January 1, 2020, with a par value of…

A: The suitable option for the given question seems to be "There is insufficient information to…

Q: Temecula Inc. issued a five-year, $10,000 bond on January 1, 2020. The bond has a 6% stated rate of…

A: Bond issue on Premium: A premium bond is one whose price is higher than the bond's face value. A…

Q: On January 1, 2021, Mirada, Inc. issued five-year bonds with a face value of $100,000 and an annual…

A: Carrying cost is value of bonds which is shown in books of accounts

Q: On January 1, 2019, G Sports Corporation issued 10% bonds with a face value of $200,000. The bonds…

A: SOLUTION- DISCOUNT ON BONDS IS THE DIFFERENCE BETWEEN THE ISSUE PRICE AND THE FACE VALUE OF BOND.…

Q: January 1, 2020, Patrick Corporation issued P10 million bonds that will mature in five years. The…

A: Sinking fund are created for the bonds so that sufficient amount get accumulated at the end of…

Q: On January 1, 2018, Parker Company issued bonds with a face value of $63,000, a stated rate of…

A: Amortization means decrease in the amount of debt over a period of time by paying some amount…

Q: On January 1, 2021, Loop Raceway issued 590 bonds, each with a face value of $1,000, a stated…

A: An amortization bond is one in which the principal (face value) on the loan is paid regularly,…

Q: On January 1, 2020, when the market rate for bonds interest was 12%, Black Corporation issued P10…

A: Amortization of bond: The process of allocation and reduction of the discount or premium on bonds…

Q: Inc., issued $ 20,000,000. of bonds, which have a ten year term and a contract or payment interest…

A: Computation paid to bond holders =face value of Bond ×Contract interest rate ×612…

Q: On January 1, 2020, Aumont Company sold 12% bonds having a maturity value of $ 500,000 for $…

A: Solution: Computation of bond price Table values are based on: n= 5     i= 10.00%…

Q: On January 1, 2020, Ellison Co. issued eight-year bonds with a face value of $6,000,000 and a stated…

A: A bond is a fixed obligation to pay that is offered to investors by a company or government…

Q: On January 1, 2020, ABC Company issued its 9%, P2 million bonds, which mature on January 2030. The…

A: Solution: Bond Amortization Schedule (Partial) Period Cash Paid Interest Expense Discoount…

Q: On December 31, 2020, Balbond issued 3,000 of its 15-year 6%, P1,000 face value bonds for…

A: Lets understand the basics. For calculating carrying value of the bond, we will need use effective…

Q: On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable…

A: 1. Workings: 600,000*7%*6/12= 21,000 Interest paid= 6% interest on carrying value for 6 months…

Q: On May 1,2020, ABC Corporation issued a 5-year, 10%, 1,000 of the P 5,000 face value bonds with a…

A: Upon initial recognition, the financial liabilities shall be measured at fair value. In general, the…

Q: N. Chocolate Company was authorized to issue 12% bonds with face amount of P5,000,000 on April 1,…

A: Solution: Net cash received from issuance of bond = Proceed from issue of Bond - bond issue cost

Q: On January 1, 2021, Sheridan Co. issued ten-year bonds with a face value of $4,500,000 and a stated…

A: Bonds are instrument issued by company acknowledging the debt raised by company . It is a liability…

Q: On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable…

A: Annual interest payment = Face value of bonds x rate of interest x time = $600,000 x 7% x 1 year =…

Q: On January

A: Bonds are priced by discounting future cash flows. Future cash flows include coupons and par value…

Q: On January 1, 2021, Surreal Manufacturing issued 690 bonds, each with a face value of $1,000, a…

A: Bonds are the liabilities to pay interest periodically and principal amount on maturity. They are…

Q: Date General Journal Debit Credit January 01, 2021

A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…

Q: Swifty Industries, Inc. issued $12,300,000 of 8% debentures on May 1, 2020 and received cash…

A: Workings:

Q: On January 1, 2021, Twister Enterprises, a manufacturer of a variety of transportable spin rides,…

A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…

Q: On December 31, 2019, Ulster Co. issued P200,000 of 8% serial bonds, to be repaid in the amount of…

A: Bonds appear to be a financial vehicles  whereby an investor or individual lends money to a company…

Q: On January 1, 2020, Bonita Industries issued eight-year bonds with a face value of $5950000 and a…

A: Present value of principal = Face value of the bonds x Present value factor at market rate

Q: On May 1,2020, ABC Corporation issued a 5-year, 10%, 1,000 of the P 5,000 face value bonds with a…

A: We know that the current carrying value of the bond is the present value of all the cash payments to…

Q: On January 1, 2021, Surreal Manufacturing issued 540 bonds, each with a face value of $1,000, a…

A: Solution 1:             Period Changes during the period Ending bond liability balances Interest…

Q: On January 1, 2020 Patrice Company issued P10 million bonds that will mature in five years. The bond…

A: A sinking fund is a fund that is used by a corporation at the time of need of the funds. This fund…

Q: On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable…

A: Date (A) Interest payment(B) Interest expenses (C) Amortisation on bond discount(C-B=D) Debit…

Q: Spiller Corp. plans to issue 10%, 15-year, $500,000 par value bonds payable that pay interest…

A: The calculation is under step 2.

Q: On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable…

A:

Q: On January 1,2019, ABC Corporation issued a 5-year, 12%, 1,000 of the P 5,000 face value bonds with…

A: Issue price of the bonds = Present value of principal + Present value of interest payments where,…

Q: hat is the amount of the gain on the bond redemptio

A:

Q: On March 1, 2020, Jagger Metal Corp. issued 8.0% bonds dated January 1, 2020. The bonds have a…

A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds payable. The…

Q: On January 1, 2021, Surreal Manufacturing issued 570 bonds, each with a face value of $1,000, a…

A:

Q: On January 1, 2021, Nebraska Company issued a 3-year bond with face value of P1,500,000 and a 9%…

A:

Q: On January 1, 2021, Ithaca Corp. purchases Cortland Inc. bonds that have a face value of $210,000.…

A: 1. The journal entry to record the purchase of the bonds: Formulation:

Q: Oriole Industries, Inc. issued $17,700,000 of 8% debentures on May 1, 2020 and received cash…

A: A bond is a fixed pay instrument issued to represents to an advance made by a financial specialist…

Q: ABC Corporation is authorized to issue P5,000,000 of 6%, 10-year bonds dated July 1, 2020, with…

A: CASH RECEIVED  P5,150,000 ACCRUED INTEREST FROM JUNE TO NOVEMBER  (5,000,000 X 6% X 4/12)…

Q: Oriole Industries, Inc. issued $17,700,000 of 8% debentures on May 1, 2020 and received cash…

A: Bond discount is the amount by which the selling price (or issue price or market price) of the bond…

Q: On January 1, 2020, Swity Company sold 11% bonds having a maturity value of $700,000 for $726,535,…

A: Interest Expense = Opening Carrying Amount * 10% Premium Amortized = Cash Paid - Interest Expense

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.