1. ate the Issue price of the corpora bonds of Evermaster on May 1, 2022 2. Prepare a 5-year discount, premium, a amortization table for the corporate bone 3. Make the interest adjustment entry on December 31, 2022 and the redemption corporate bond entry on July 1, 2024.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 6PA: Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...
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Accounting
Evermaster issued 20 corporate bonds with a face
value of $100,000 on May 1, 2022, each with a
maturity of 5 years. The corporate bonds will
accrue interest from January 1, 2022, with a
coupon rate of 6%, and the interest will be paid
once a year. The market rate applicable to
Evermaster at the time of issuance is 8%. On July 1,
2024, Evermaster Company redeemed 10
corporate bonds at 100 plus accrued interest.
1. Calculate the issue price of the corporate
bonds of Evermaster on May 1, 2022
2. Prepare a 5-year discount, premium, and
amortization table for the corporate bond
3. Make the interest adjustment entry on
December 31, 2022 and the redemption
corporate bond entry on July 1, 2024.
Transcribed Image Text:Accounting Evermaster issued 20 corporate bonds with a face value of $100,000 on May 1, 2022, each with a maturity of 5 years. The corporate bonds will accrue interest from January 1, 2022, with a coupon rate of 6%, and the interest will be paid once a year. The market rate applicable to Evermaster at the time of issuance is 8%. On July 1, 2024, Evermaster Company redeemed 10 corporate bonds at 100 plus accrued interest. 1. Calculate the issue price of the corporate bonds of Evermaster on May 1, 2022 2. Prepare a 5-year discount, premium, and amortization table for the corporate bond 3. Make the interest adjustment entry on December 31, 2022 and the redemption corporate bond entry on July 1, 2024.
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