Bringham Company issues bonds with a par value of $800,000 on their stated issue date. The bonds mature in 10 years and pay 6% annual interest in semiannual payments. On the issue date, the annual market rate for the bonds is 8%. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided.)
What is the amount of each semiannual interest payment for these bonds?
How many semiannual interest payments will be made on these bonds over their life?
Use the interest rates given to select whether the bonds are issued at par, at a discount, or at a premium.
Par (maturity) value Semiannual Rate Semiannual cash interest payment = Number of payments Whether the bonds are issued at par, at a discount, or at a premium?
Compute the price of the bonds as of their issue date.
Table Values are Based on: n = i = Cash Flow Table Value Amount Present Value Par (maturity) value Interest (annuity) Price of bonds
Prepare the journal entry to record the bondsâ issuance.
1- Record the issue of bonds with a par value of $800,000 for cash.
Bringham Company issues bonds with a par value of $800,000 on their stated issue date. The bonds mature in 10 years and pay 6% annual interest in semiannual payments. On the issue date, the annual market rate for the bonds is 8%. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided.)
What is the amount of each semiannual interest payment for these bonds?
How many semiannual interest payments will be made on these bonds over their life?
Use the interest rates given to select whether the bonds are issued at par, at a discount, or at a premium.
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Compute the price of the bonds as of their issue date.
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Prepare the journal entry to record the bondsâ issuance.
1- Record the issue of bonds with a par value of $800,000 for cash.
Related questions
Hillside issues $1,800,000 of 7%, 15-year bonds dated January 1,2015, that pay interest semiannually on June 30 and December 31.The bonds are issued at a price of $1,555,401.
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| 1. | Prepare the January 1, 2015, journal entry to record the bondsâissuance. |
2(a) For each semiannual period, complete thetable below to calculate the cash payment.
2(b) For each semiannual period, complete thetable below to calculate the straight-line discountamortization.
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