Fall 2017: Chapter 10 Quiz-Version A A corporation issues SS00,000, 6%, 5-year b

Question

Fall 2017: Chapter 10 Quiz-Version A A corporation issues SS00,000, 6%, 5-year bonds on lanuary 1, 2016 for $312,000 when the mar 4%. Interest is paid annually on lanuary 1. If the corporation uses the straigt-Gne method of premium, the amount of bond interest expense to be recognized in December 31, 2016's adusting entry 1 rate of interest is amortization of boned A $18,720 B $15,600 C $18,000 D $12,480 Use the following information to complete 2 &3 tral County Bank agrees to lend the Bryce Company S350,000 on May 1st. Bryce Company signs a ssooo.c%, 9- month note. 2 What is the adjusting entry required if Bryce Company prepares fianncial statements on June 30th2 A Interest Expense B Interest Expense C Interest Payable D Interest Payable 3,500 interest Payable 3,500 3,500 Cash 3,500 3,500 3,500 Interest Expense 3 What entry will Bryce Company make to pay off the note and interest at maturity assuming that interest has not been accrued since June 30th? 3,500 12,250 350,000 A Interest Payable Interest Expense Note Payable 365,750 365,750 Note Payable Cash Note Payable 8 365,750 350,000 15,750 C Interest Payable 365,750 Cash D Note Payable 350,000 Cash 4 Most companies pay current liabilities A B by issuing interest-bearing notes payable. by issuing stock. C by creating long-term liabiltities D out of current assets

Explanation / Answer

1. Premium = 12000 . Ammortized premium = 12000/5 = 2400.

Coupon = 6% on 300,000 = 18000

Int exp = Interest payable - Ammort of bond premium = 18000-2400 = 15600

Ans :- B

Kindly post qs separately for better understanding.

If this answer was helpful , Please leave a thumbs up! If you are unsatisfied with my answer , please leave a note in the comments section and I will try my best to clarify it for you. All the best! Thanks :) Feel free to comment for any clarifications.

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.