Class Notes (1,000,000)
CA (610,000)
Western (50,000)
2257 (100)
T B A (20)
Lecture 18

Business Administration 2257 Lecture 18: DuffinbearPremium


Department
Business Administration
Course Code
Business Administration 2257
Professor
T B A
Lecture
18

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BUS 2257: Lecture 18 – Duffinbear
9% Bonds
JANUARY 1/11 1.)
Dr Cash 937,689 2.)
1,884
Cr Bonds Payable 937,689 T/B
939,574
Interest Payments: 1,000,000*9%*(6/12)*12.46221=560,799 3.)
264
PV of FV: 1,000,000*0.37689=376,890
Price Received: 560,799+376,890=937,689 T/B
563,74
4
JULY 1/11
Dr Interest Expense
46,884
Cr Bond Payable
1,884
Cr Cash
45,000
Cash: 1,000,000*9%*(6/12)=45,000
Interest: 9,37,689*10%*(6/12)=46,884
Bond: 46,884-45,000=1,884
SEPTEMBER 1/11
Dr Interest Expense
6,264
Cr Bond Payable
264
Cr Cash
6,000
Cash: 1,000,000*9%*(2/12)*40%=6,000
Interest: (9,37,689+1,884)*10%*(2/12)*40%=6,264
Bond: 6,264-6,000=264
Dr Bond Payable
376,09
3
Dr Loss on Recall
31,907
Cr Cash
408,00
0
Book Value:((937,689+1,844)*40%)+264=376,093
Cash: 1,000,000*40%*1.02=408,000
Loss on Recall: 408,000-376,093=31,907
DECEMBER 31/11
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