8. On February 1, 2015, Pat Weaver Inc. (PWI) issued 9%,$1,100,000 bonds for $1,400,000. PWI retired all of these bonds onJanuary 1, 2016, at 104. Unamortized bond premium on that date was$114,400. How much gain or loss should be recognized on this bondretirement?
$99,000 gain.
$126,000 gain.
$0 gain.
$70,400 gain.
9. TMC issued $90 million of its 12% bonds on April 1, 2016, at98 plus accrued interest. The bonds are dated January 1, 2016, andmature on December 31, 2035. Interest is payable semiannually onJune 30 and December 31. What amount did TMC receive from the bondissuance? (Do not round intermediate calculations.)
$88.20 million.
$90.90 million.
$85.50 million.
$92.70 million.
10. On September 1, 2016, Sam's Shoe Co. issued $460,000 of 9%bonds. The bonds pay interest semiannually on January 1 and July 1of each year. The bonds were sold at the face amount. How much cashdid Sam's receive upon sale of the bonds? (Do not roundintermediate calculations and round final answer to nearest wholedollar.)
$480,700.
$501,400.
$466,900.
$460,000.
11. Auerbach Inc. issued 6% bonds on October 1, 2016. The bondshave a maturity date of September 30, 2026 and a face value of $475million. The bonds pay interest each March 31 and September 30,beginning March 31, 2017. The effective interest rate establishedby the market was 8%.
Assuming that Auerbach issued the bonds for $410,447,453, whatinterest expense would it recognize in its 2016 income statement?(Do not round intermediate calculations and round final answer tonearest whole dollar.)
$0
$8,208,949
$16,417,898
$9,500,000
12. Auerbach Inc. issued 4% bonds on October 1, 2016. The bondshave a maturity date of September 30, 2026 and a face value of $370million. The bonds pay interest each March 31 and September 30,beginning March 31, 2017. The effective interest rate establishedby the market was 6%.
Assuming that Auerbach issued the bonds for $319,716,000, whatwould the company report for its net bond liability balance afterits first interest payment on March 31, 2017?
$324,098,960
$321,907,480
$317,524,520
$319,716,000
8. On February 1, 2015, Pat Weaver Inc. (PWI) issued 9%,$1,100,000 bonds for $1,400,000. PWI retired all of these bonds onJanuary 1, 2016, at 104. Unamortized bond premium on that date was$114,400. How much gain or loss should be recognized on this bondretirement?
$99,000 gain.
$126,000 gain.
$0 gain.
$70,400 gain.
9. TMC issued $90 million of its 12% bonds on April 1, 2016, at98 plus accrued interest. The bonds are dated January 1, 2016, andmature on December 31, 2035. Interest is payable semiannually onJune 30 and December 31. What amount did TMC receive from the bondissuance? (Do not round intermediate calculations.)
$88.20 million.
$90.90 million.
$85.50 million.
$92.70 million.
10. On September 1, 2016, Sam's Shoe Co. issued $460,000 of 9%bonds. The bonds pay interest semiannually on January 1 and July 1of each year. The bonds were sold at the face amount. How much cashdid Sam's receive upon sale of the bonds? (Do not roundintermediate calculations and round final answer to nearest wholedollar.)
$480,700.
$501,400.
$466,900.
$460,000.
11. Auerbach Inc. issued 6% bonds on October 1, 2016. The bondshave a maturity date of September 30, 2026 and a face value of $475million. The bonds pay interest each March 31 and September 30,beginning March 31, 2017. The effective interest rate establishedby the market was 8%.
Assuming that Auerbach issued the bonds for $410,447,453, whatinterest expense would it recognize in its 2016 income statement?(Do not round intermediate calculations and round final answer tonearest whole dollar.)
$0
$8,208,949
$16,417,898
$9,500,000
12. Auerbach Inc. issued 4% bonds on October 1, 2016. The bondshave a maturity date of September 30, 2026 and a face value of $370million. The bonds pay interest each March 31 and September 30,beginning March 31, 2017. The effective interest rate establishedby the market was 6%.
Assuming that Auerbach issued the bonds for $319,716,000, whatwould the company report for its net bond liability balance afterits first interest payment on March 31, 2017?
$324,098,960
$321,907,480
$317,524,520
$319,716,000
