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On March 1, 2020, Quinto Mining Inc. issued a $690,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2020. 1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue 2. Using the effective interest method, prepare an amortization schedule. (Image attached) 3.  Record the entries for the issuance of the bond on March 1, the adjusting entry to accrue bond interest and related amortization on April 30, 2020, Quinto’s year-end, and the payment of interest on September 1, 2020.  Record the issuance of bond Record accrual of interest on bond Record payment of interest

On March 1, 2020, Quinto Mining Inc. issued a $690,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2020. 1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue 2. Using the effective interest method, prepare an amortization schedule. (Image attached) 3.  Record the entries for the issuance of the bond on March 1, the adjusting entry to accrue bond interest and related amortization on April 30, 2020, Quinto’s year-end, and the payment of interest on September 1, 2020.  Record the issuance of bond Record accrual of interest on bond Record payment of interest

College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter22: Corporations: Bonds
Section: Chapter Questions
Problem 8SPB: BONDS ISSUED AT FACE VALUE Ramona Arroyo Co. issued the following bonds: REQUIRED Prepare journal...
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On March 1, 2020, Quinto Mining Inc. issued a $690,000, 8%, three-year bond. Interest is payable semiannually beginning September 1, 2020.

1. Calculate the bond issue price assuming a market interest rate of 7% on the date of issue

2. Using the effective interest method, prepare an amortization schedule. (Image attached)

3.  Record the entries for the issuance of the bond on March 1, the adjusting entry to accrue bond interest and related amortization on April 30, 2020, Quinto’s year-end, and the payment of interest on September 1, 2020. 

  • Record the issuance of bond
  • Record accrual of interest on bond
  • Record payment of interest
Period Cash Interest Period Interest Premium Unamortized Carrying Value Ending Paid Expense Amort. Premium Mar. 1/20 Sept. 1/20 Mar. 1/21 Sept. 1/21 Mar. 1/22 Sept. 1/22 Mar. 1/23 Totals $ 0 $ Record the entries for the issuance of the bond on March 1 th e adiusting entry to a
Transcribed Image Text:Period Cash Interest Period Interest Premium Unamortized Carrying Value Ending Paid Expense Amort. Premium Mar. 1/20 Sept. 1/20 Mar. 1/21 Sept. 1/21 Mar. 1/22 Sept. 1/22 Mar. 1/23 Totals $ 0 $ Record the entries for the issuance of the bond on March 1 th e adiusting entry to a
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