PB10-4 Comparing Bonds Issued at Par, Discount, and Premium [LO 10-3] Marshalls

Question

PB10-4 Comparing Bonds Issued at Par, Discount, and Premium [LO 10-3] Marshalls Corporation completed a $640,000 8 percent bond issue on January 1 2015 The bonds pay interest each December 31 and mature 10 years from January 1. 2015 Required: For each of the three Independent cases that follow, Provide the following amounts to be reported on the January 1 2015. financial statements immediately after the bonds were issued Case B (Issued at 100)lat 98) Case A 1, 2015 Financial statements (at 102) a. Bonds Payable b fUnamortized Premium (or discount) c. Carrying Value

Explanation / Answer

Jan 1, 2015-Financial statements Case A (Issued at 100) Case B (Issued at 98) Case B (Issued at 102) a Bonds payable $ 640,000 $ 640,000 $ 640,000 b Unamortized premoium (or discount) $ 0 $ 12,800 $ 12,800 c Carrying value $ 640,000 $ 627,200 $ 652,800

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