Business, 18.02.2021 21:20 leoniandreww

Cupola Fan Corporation issued 10%, $400,000, 10-year bonds for $385,000 on June 30, 2011. Transaction costs were $1,500. Interest is paid semiannually on December 31 and June 30. One year from the issue date (July 1, 2012), the corporation exercised its call privilege and retired the bonds for $395,000. The corporation uses the straight-line method both to determine interest expense and to amortize debt issue costs. Required:
1. Use the effective interest method to calculate interest expense. effective interest is 10.6%
2. Prepare an amortization table for 3 years - six interest periods by using straight line
3. Prepare journal entry to record the issuance of the bonds
4. Prepare journal entry to record the payment of interest and amortization of debt issue costs on Dec 31, 2011
5. Prepare journal entry to record the call of the bond.

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 13:50

The state troopers in one state have a motto, “nine you’re fine; ten you’re mine,” which is the standard that they use for pulling over speeders on the state highways. in other words, if the posted speed limit is 55 mph, drivers can drive at a rate up to 64 mph without fear of getting a ticket. which of the following best describes the ethical culture in the state? a. the troopers are following a standard of positive law. b. the troopers are following a normative standard. c. the troopers are following a headline test. d. the troopers are following the blanchard/peale standard.

Answers: 1

Answer

Business, 22.06.2019 21:10

You are the manager of a large crude-oil refinery. as part of the refining process, a certain heat exchanger (operated at high temperatures and with abrasive material flowing through it) must be replaced every year. the replacement and downtime cost in the first year is $165 comma 000. this cost is expected to increase due to inflation at a rate of 7% per year for six years (i.e. until the eoy 7), at which time this particular heat exchanger will no longer be needed. if the company's cost of capital is 15% per year, how much could you afford to spend for a higher quality heat exchanger so that these annual replacement and downtime costs could be eliminated?

Answers: 1

Answer

Business, 23.06.2019 01:10

Snuggables sells microwaveable heat packs online. their sales software collects customer/sales information and shares it with the customer service and sales departments. none of the customer complaints or suggestions reach the product development person, however. which step of the three-step processes for success is snuggables failing to use fully?

Answers: 2

Answer

Business, 23.06.2019 04:50

Suppose an investor starts with a portfolio consisting of one randomly selected stock. as more and more randomly selected stocks are added to the portfolio, what happens to the portfolio's risk

Answers: 1

Answer

You know the right answer?

Cupola Fan Corporation issued 10%, $400,000, 10-year bonds for $385,000 on June 30, 2011. Transactio...

Questions