Exam 20: Corporations and Bonds Payable

Using the following accounts: [1]Cash [2]Sinking fund [3]Equipment [4]Building [5]Land [6]Accounts payable [7]Notes payable [8]Bond payable [9]Bond interest expense payable [10]Premium on bonds payable [11]Discount on bonds payable [12]Common stock [13]Retained earnings [14]Sinking fund earned [15]Bond interest expense [16]Gain on retirement [17]Loss on retirement Indicate the account(s) to be debited and credited to record the following transactions. -Retired bonds plus interest previously accrued when the retirement value was above the cost of retirement,cash was paid. Debit ________ & ________ & ________ Credit ________ & ________ & ________

Bond Interest Payable is reported as a:

If bonds are sold between interest payment dates,the amount of cash the issuer receives is:

On October 1,Allan Company issued 8%,10-year,$300,000 bonds at 105.Interest dates are April 1 and October 1.The amount of cash paid out for interest during the current calendar year is:

A premium bond's ________ decreases over time until it reaches face value.

Moab Corporation sells $500,000 of 7%,20-year bonds for 98 on January 1.Interest is paid on January 1 and July 1.Straight-line amortization is used.What is the amount of the discount at issuance?

The formal written agreement for issuing bonds is called a(n)________.

On January 1,20XX,Edward Company issued $200,000,10-year,8% bonds with semiannual interest payments on June 30 and December 31.Record the 20XX journal entries.

Using the following accounts: [1]Cash [2]Sinking fund [3]Equipment [4]Building [5]Land [6]Accounts payable [7]Notes payable [8]Bond payable [9]Bond interest expense payable [10]Premium on bonds payable [11]Discount on bonds payable [12]Common stock [13]Retained earnings [14]Sinking fund earned [15]Bond interest expense [16]Gain on retirement [17]Loss on retirement Indicate the account(s) to be debited and credited to record the following transactions. -Retired bonds plus interest previously accrued when the retirement value was beneath the cost of retirement,cash was paid. Debit ________ & ________ & ________ Credit ________ & ________ & ________

A bond sinking fund is a:

Bailey Corporation has decided to issue bonds pledging specific assets.What type of bonds is it offering?

On October 1,Indiana Company issued $10,000,8%,5-year bonds at 102.What is the adjusting entry on December 31 using straight-line method?

The carrying value of bonds is calculated by:

What is the purpose of a bond sinking fund?

The carrying value for bonds sold at a discount:

When selling bonds at a premium,the premium received effectively:

On October 1,Allan Company issued 8%,10-year,$300,000 bonds at 100.Interest dates are April 1 and October 1.The amount of cash paid out for interest during the current calendar year is:

A $1,000 bond quoted at 104 would sell for:

When the maturities of a bond issue are spread over a several dates,the bonds are called:

A special type of long-term interest-bearing note payable issued by a corporation to raise capital is called a: