Hartford Research issues bonds dated January 1, 2015, that payinterest semiannually on June 30 and December 31. The bonds have a$28,000 par value and an annual contract rate of 10%, and theymature in 10 years. (Table B.1, Table B.2, Table B.3, and TableB.4) (Use appropriate factor(s) from the tables provided.Round all table values to 4 decimal places, and use the roundedtable values in calculations.)
Required: Consider each of the followingthree separate situations.
1. The market rate at the date ofissuance is 8%.
(a) Complete the below table to determine the bonds' issue price onJanuary 1, 2015.
Total Values are based on
n= __?
i=__?
Cash Flow Table Value Amount Present Value
Par value (maturity) ?? ?? ??
Interest (annuity) ?? ?? ??
Price of bonds ??
(b) Prepare the journal entry to record their issuance.
Record the issue of bonds with a par value of $28,000 cash onJanuary 1, 2015. Assume that the market rate of interest at thedate of issue is 8%.
JAN 01
2. The market rate at the date ofissuance is 10%.
(a) Complete the below table to determine the bonds' issue price onJanuary 1, 2015.
n= __?
i=__?
Cash Flow Table Value Amount Present Value
Par value (maturity) ?? ?? ??
Interest (annuity) ?? ?? ??
Price of bonds ??
(b) Prepare the journal entry to record their issuance.
Record the issue of bonds with a par value of $28,000 cash onJanuary 1, 2015. Assume that the market rate of interest at thedate of issue is 10%.
3. The market rate at the date ofissuance is 12%.
(a) Complete the below table to determine the bonds' issue price onJanuary 1, 2015.
Record the issue of bonds with a par value of $28,000 cash onJanuary 1, 2015. Assume that the market rate of interest at thedate of issue is 8%.
JAN 01
2. The market rate at the date ofissuance is 10%.
(a) Complete the below table to determine the bonds' issue price onJanuary 1, 2015.
n= __?
i=__?
Cash Flow Table Value Amount Present Value
Par value (maturity) ?? ?? ??
Interest (annuity) ?? ?? ??
Price of bonds ??
(b) Prepare the journal entry to record their issuance.
- Record the issue of bonds with a par value of $28,000 cash onJanuary 1, 2015. Assume that the market rate of interest at thedate of issue is 12%.
Hartford Research issues bonds dated January 1, 2015, that payinterest semiannually on June 30 and December 31. The bonds have a$28,000 par value and an annual contract rate of 10%, and theymature in 10 years. (Table B.1, Table B.2, Table B.3, and TableB.4) (Use appropriate factor(s) from the tables provided.Round all table values to 4 decimal places, and use the roundedtable values in calculations.) |
| Required: |
| Consider each of the followingthree separate situations. |
| 1. | The market rate at the date ofissuance is 8%. |
| (a) | Complete the below table to determine the bonds' issue price onJanuary 1, 2015. | |||||||||||||||||||||||||
| Total Values are based on n= __? i=__? Cash Flow Table Value Amount Present Value Par value (maturity) ?? ?? ?? Interest (annuity) ?? ?? ?? Price of bonds ??
|
Related questions
Hartford Research issues bonds dated January 1, 2015, that payinterest semiannually on June 30 and December 31. The bonds have a$31,000 par value and an annual contract rate of 12%, and theymature in 10 years. (Table B.1, Table B.2, Table B.3, and TableB.4) (Use appropriate factor(s) from the tables provided.Round all table values to 4 decimal places, and use the roundedtable values in calculations.) |
| Required: |
| Consider each of the followingthree separate situations. |
| 1. | The market rate at the date ofissuance is 10%. |
| (a) | Complete the below table to determine the bonds' issue price onJanuary 1, 2015.
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Hartford Research issues bonds dated January 1, 2015, that pay interest semiannually on June 30 and December 31. The bonds have a $31,000 par value and an annual contract rate of 12%, and they mature in 10 years. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided. Round all table values to 4 decimal places, and use the rounded table values in calculations.) |
| Required: |
| Consider each of the following three separate situations. |
| 1. | The market rate at the date of issuance is 10%. |
| (a) | Complete the below table to determine the bonds' issue price on January 1, 2015. |
| |||||||||||||||||||||||||||
| (b) | Prepare the journal entry to record their issuance. |
| Date | General Journal | Debit | Credit |
| Jan 01, 2015 | Cash | 34,864 | |
| Premium on bonds payable | 3,864 | ||
| Bonds payable | 31,000 |
|
|
| (a) | Complete the below table to determine the bonds' issue price on January 1, 2015. |
| |||||||||||||||||||||||||||
| (b) | Prepare the journal entry to record their issuance. |
Journal Entry Worksheet
· Record the issue of bonds with a par value of $31,000 cash on January 1, 2015. Assume that the market rate of interest at the date of issue is 12%.
| Date | General Journal | Debit | Credit |
| Jan 01, 2015 | Cash | ||
| The market rate at the date of issuance is 14%. | |
| (a) | Complete the below table to determine the bonds' issue price on January 1, 2015. | |||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||
| (b) | Prepare the journal entry to record their issuance. |
Journal Entry Worksheet
· Record the issue of bonds with a par value of $31,000 cash on January 1, 2015. Assume that the market rate of interest at the date of issue is 14%.
| Date | General Journal | Debit | Credit |
| Jan 01, 2015 | Cash | ||
| Bonds payable |
