Q: Matt Perry, Inc. had outstanding $6,000,
Matt Perry, Inc. had outstanding $6,000,000 of 11% bonds (interest payable July 31 and January 31) due in 10 years. On July 1, it issued $9,000,000 of 10%, 15-year bonds (interest payable July 1 and J...
See AnswerQ: On June 30, 2009, County Company issued 12% bonds
On June 30, 2009, County Company issued 12% bonds with a par value of $800,000 due in 20 years. They were issued at 98 and were callable at 104 at any date after June 30, 2017. Because of lower intere...
See AnswerQ: The following are three different and unrelated situations involving depreciation accounting.
The following are three different and unrelated situations involving depreciation accounting. Answer the question(s) at the end of each situation. Situation I: Recently, Broderick Company experienced...
See AnswerQ: Jason Day Company had bonds outstanding with a maturity value of $
Jason Day Company had bonds outstanding with a maturity value of $300,000. On April 30, 2017, when these bonds had an unamortized discount of $10,000, they were called in at 104. To pay for these bond...
See AnswerQ: On January 1, 2017, Ellen Carter Company makes the two
On January 1, 2017, Ellen Carter Company makes the two following acquisitions. 1. Purchases land having a fair value of $200,000 by issuing a 5-year, zero-interest-bearing promissory note in the face...
See AnswerQ: Presented below are two independent situations. a. On January
Presented below are two independent situations. a. On January 1, 2017, Robin Wright Inc. purchased land that had an assessed value of $350,000 at the time of purchase. A $550,000, zero-interest-beari...
See AnswerQ: On January 1, 2017, Margaret Avery Co. borrowed and
On January 1, 2017, Margaret Avery Co. borrowed and received $400,000 from a major customer evidenced by a zero-interest-bearing note due in 3 years. As consideration for the zero-interest-bearing fea...
See AnswerQ: Fallen Company commonly issues long-term notes payable to its various
Fallen Company commonly issues long-term notes payable to its various lenders. Fallen has had a pretty good credit rating such that its effective borrowing rate is quite low (less than 8% on an annual...
See AnswerQ: Strickland Company owes $200,000 plus $18,000
Strickland Company owes $200,000 plus $18,000 of accrued interest to Moran State Bank. The debt is a 10-year, 10% note. During 2017, Strickland’s business deteriorated due to a faltering regional econ...
See AnswerQ: On December 31, 2017, American Bank enters into a debt
On December 31, 2017, American Bank enters into a debt restructuring agreement with Barkley Company, which is now experiencing financial trouble. The bank agrees to restructure a 12%, issued at par, $...
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