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Wiley Assignment - Accounting

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Question;Wiley;Assignment;Brief Exercise 14-6;On January 1, 2013, JWS Corporation issued;$649,000 of 7% bonds, due in 8 years. The bonds were issued;for $611,190, and pay interest each July 1 and January 1. JWS uses the;effective-interest method.;Prepare the company?s journal entries for (a) the January 1 issuance, (b);the July 1 interest payment, and (c) the December 31 adjusting entry.;Assume an effective-interest rate of 8%.(Round;answers to 0 decimal places, e.g. $38,548. Credit account titles are;automatically indented when amount is entered. Do not indent manually.);No.;Account Titles and;Explanation;Debit;Credit;Exercise 14-16;On January 1, 2013, McLean Company makes the two following;acquisitions.;1.;Purchases land having a fair value of $394,000 by issuing;a 5-year, zero-interest-bearing promissory note in the face amount of;$663,913.;2.;Purchases equipment by issuing a 6%, 9-year promissory;note having a maturity value of $566,000. (interest payable annually).;The company has to pay 11% interest for funds from its bank.;(a);Record the two journal entries that should be recorded by McLean;Company for the two purchases on January 1, 2013.;(b);Record the interest at the end of the first year on both notes;using the effective-interest method.;(Round answers to 0 decimal places, e.g. $38,548.);No.;Account Titles and;Explanation;Debit;Credit;(a) 1.;At December 31, 2012, Redmond Company has outstanding three;long-term debt issues. The first is a $2,025,300 note payable which;matures June 30, 2015. The second is a $6,046,300 bond issue which matures;September 30, 2016. The third is a $12,559,000 sinking fund debenture with;annual sinking fund payments of $2,511,800 in each of the years 2014;through 2018.;Prepare the required note disclosure for the long-term debt at December 31;2012.;Long-term Debt;2013;$;2014;$;2015;$;2016;$;2017;$;Brief Exercise 17-3;Carow Corporation purchased, as a held-to-maturity investment;$72,100 of the 9%, 5-year bonds of Harrison, Inc. for $78,100;which provides a 7% return. The bonds pay interest semiannually.;Prepare Carow?s journal entries for (a) the purchase of the investment, and (b);the receipt of semiannual interest and premium amortization. Assume effective-interest;amortization is used.(Round answers to 0 decimal;places, e.g. 2,500. Credit account titles are automatically indented when;amount is entered. Do not indent manually.);No.;Account Titles and;Explanation;Debit;Credit;(a);Brief Exercise 17-4;Hendricks Corporation purchased trading investment bonds for;$52,040 at par. At December 31, Hendricks received annual interest of;$2,580, and the fair value of the bonds was $49,530.;Prepare Hendricks? journal entries for (a) the purchase of the investment, (b);the interest received, and (c) the fair value adjustment.(Credit account titles are automatically indented when amount is;entered. Do not indent manually.);No.;Account Titles and;Explanation;Debit;Credit;(aCardinal Paz Corp. carries an account in its general ledger called;Investments, which contained debits for investment purchases, and no credits;with the following descriptions.;Feb. 1, 2012;Sharapova Company common stock;$104 par, 208 shares;$45,800;April 1;U.S. government bonds, 12%, due April 1, 2022, interest;payable April 1 and October 1, 113 bonds of $1,000 par each;113,000;July 1;McGrath Company 12% bonds, par $53,000, dated March 1;2012, purchased at 104 plus accrued interest, interest payable annually on;March 1, due March 1, 2032;57,240;(a) Prepare entries necessary to classify the amounts into proper;accounts, assuming that all the securities are classified as;available-for-sale.(Credit account titles are;automatically indented when amount is entered. Do not indent manually.);Account Titles and;Explanation;Debit;Credit;(b) Prepare the entry to record the accrued interest and the;amortization of premium on December 31, 2012, using the straight-line method.(Round answers to 0 decimal places, e.g. $2,500. Credit account;titles are automatically indented when amount is entered. Do not indent;manually.);Account Titles and;Explanation;Debit;Credit;(c) The fair values of the investments on December 31, 2012, were;Sharapova Company common stock;$34,630;U.S. government bonds;146,910;McGrath Company bonds;59,710;What entry or entries, if any, would you recommend be made?(Round answers to 0 decimal places, e.g. $2,500. Credit account;titles are automatically indented when amount is entered. Do not indent;manually.);Account Titles and;Explanation;Debit;Credit;(d) The U.S. government bonds were sold on July 1, 2013, for;$120,100 plus accrued interest. Give the proper entry.(Credit account titles are automatically indented when amount is;entered. Do not indent manually.);Account Titles and;Explanation;Debit;Credit

 

Paper#38954 | Written in 18-Jul-2015

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