EX105.Interest is payable annually. Mintz uses the straighe-line method of amort
ID: 2566807 • Letter: E
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EX105.Interest is payable annually. Mintz uses the straighe-line method of amortization and has a calendar year end. 6 PO EX10#11 : BONDS ISSUED AT PREMIUM: Mintz Company issued S400,000, 10%, 10-year 105. Interest is payable annually. Mintz uses the straight-line January 1, 2017, at year end. 6 POINTS bonds on Instructions: (Complete Amortization Schedule- Bonds Issued at a Premium) Prepare all journal entries made in 2017 related to the bond issue. 1. What is the issuance price of the bond at a premium? What is the unamortized premium on the bond at issuance?Prepare the journal entry for the bond issuance. Dr. Cr. Cr 2. Prepare the amortization schedule for the bond issued at a premium for the 10 years. 3. What is the Balance Sheet Reporting of the bond at the end of the fifth interest period (carrying value of bond)? Bond Payable Add: Unamortized Premium on bonds Payable S Carrying Value of Bond 4. What is the total interest expense recorded for the ten years? $ HW12. Hw10#12: BONDS ISSUED AT A PREMIUM: Grand Company issued $800,000, 10%, 20-year bonds on January 1, 2017. 104. Interest is payable annually on January 1. Grand uses the straight-line method of amortization and has a calendar year e 8 POINTS Instructions: 1. What is the issuance price of the bond? SWhat is the total of the unamortized premium on the bond? 2. What is the carrying value of the bond at the end of the first interest period? S 3. What is the unamortized premium on the bond at the end of the second interest period?Explanation / Answer
1 What is issuance price of bond at a premium? Issunace price (400,000 *105/100) $ 420,000 What is unamortized premium on the bond at issunace? Issunce price $ 420,000 Less: Face Value $ 400,000 Unamortized Premium $ 20,000 Journal Entry Date Particulars Debit Credit 2017 January 1 Cash $ 420,000 Bonds Payable $ 400,000 Premium on Bonds Payable $ 20,000 2 time Interest payment (bonds payable x 10% Interest Expense premium amortization Cr Bal in Premium A/C Cr Bal in Bond payable Book Value of bonds 0 20000 400000 420000 1 40000 38000 2000 18000 400000 418000 2 40000 38000 2000 16000 400000 416000 3 40000 38000 2000 14000 400000 414000 4 40000 38000 2000 12000 400000 412000 5 40000 38000 2000 10000 400000 410000 6 40000 38000 2000 8000 400000 408000 7 40000 38000 2000 6000 400000 406000 8 40000 38000 2000 4000 400000 404000 9 40000 38000 2000 2000 400000 402000 10 40000 38000 2000 0 400000 400000 Total 380000 3 Balance Sheet (Partial) Bond payable $ 400,000 Add: Unamortized Premium on bonds payable $ 10,000 Carrying value of bond $ 410,000 4 Total interest expense 380000 (from schedule) Note: in the similar manner second question can be answered, still need any help please ask in comment, hope a positive feedback, thank you.
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