1. At December 31, 2014, Redmond Company has outstanding three long-term debt is
ID: 2454681 • Letter: 1
Question
1. At December 31, 2014, Redmond Company has outstanding three long-term debt issues. The first is a $2,034,700 note payable which matures June 30, 2017. The second is a $6,019,200 bond issue which matures September 30, 2018. The third is a $12,507,000 sinking fund debenture with annual sinking fund payments of $2,501,400 in each of the years 2016 through 2020.
Prepare the required note disclosure for the long-term debt at December 31, 2014. 2015? 2016? 2017? 2018?2019?
2.
Exercise 14-9
On June 30, 2014, Mischa Auer Company issued $4,136,000 face value of 13%, 19-year bonds at $4,443,021, a yield of 12%. Auer uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31.
(a) Prepare the journal entries to record the following transactions. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
The payment of interest and the amortization of the premium on December 31, 2015.
B. Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2015, balance sheet.
C. Provide the answers to the following questions.
(1) What amount of interest expense is reported for 2015? (Round answer to 0 decimal places, e.g. 38,548.)
The payment of interest and the amortization of the premium on December 31, 2015.
number date acct dr cr 1. june 30, 2014 2 December 31, 2014 3 June 30, 2015 4 December 31, 2015B. Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2015, balance sheet.
Explanation / Answer
1. At December 31, 2014, Redmond Company has outstanding three long-term debt is
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