On January 1, 2018, XYZ Co. sold services to a customer in exchange for a four...
On January 1, 2018, XYZ Co. sold services to a customer in exchange for a four year $100,000 promissory note with an annual interest rate of 4%. Interest only payments are due SEMI-ANNUALLY, beginning on June 30, 2018. The market rate for an equivalent loan to this customer would have been 6%*. XYZ Co. uses IFRS, has a Dec 31 year end, and prepares adjusting entries annually. Required: a) Calculate the amount of revenue to be recorded on January 1st 2018 by XYZ Co for the sale of the equipment. i. Calculate using the present value tables in the textbook. ii. Calculate using EXCEL “PV” formula. Copy your Excel formula to another cell as text so it can be viewed (put ‘ in front of it for text.) (Remember that the payment and the future value must be negative.) b) Prepare the journal entries for XYZ Co. at Jan 1, 2018, June 30, 2018, and Dec 31, 2018. (Show all calculations.) c) Prepare the note amortization schedule. Be sure to show the semi-annual interest payments and the payment of the note on Jan 1, 2022. *HINT: semi-annual payments, therefore, there is a payment every 6 months. Interest rates are always quoted on an annual basis.
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On January 1, 2018, XYZ Co. sold services to a customer in
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Questions 9-11 On January 1, 2019, Will, Inc. rendered services to ABC Co. in exchange for...
Questions 9-11 On January 1, 2019, Will, Inc. rendered services to ABC Co. in exchange for a $378,000, 5 year note. The terms of the agreement require ABC to make semi-annual installment payments of P&I with the first installment due July 1st. An annual interest rate of 8% is imputed. Each payment is to be received on July 1 and Jan 1. Will’s year end is December 31st. Required: 1. What amount of Service Revenue can Will record on January 1, 2019?...
11/1/2019 The Piano Co. borrowed funds to replace its damaged roof Amount borrowed ...
11/1/2019 The Piano Co. borrowed funds to replace its damaged roof Amount borrowed 180,000 Interest rate 5% Term of note 6 months INSTRUCTIONS: Prepare the journal entries to record the issuance of the note the accrual of interest at year end the payment of the note on its due date On January 1, 2019, Teasdale Corp. issued 10 year 800,000 5% bond payable. Interest is payable semi-annually on June 30 and December 31. INSTRUCTIONS: Prepare the journal entry...
On January 1, 2018, ABC & Co. issues convertible bonds with a maturity of 5 years....
On January 1, 2018, ABC & Co. issues convertible bonds with a maturity of 5 years. The par value of the bonds is $400,000, the coupon rate is 6%, and the compounding period is semi-annual with interest paid on June 30th and December 31st. The market prices these bonds using an interest rate (effective rate) of 4% compounded semi-annually. Each $1,000 bond is convertible to 100 shares of ABC & Co. common stock. 1. On July 1, 2018, the company...
On January 1, 2018, MM Co. borrows $330,000 cash from a bank and in return signs...
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Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $480,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Your answer is correct. Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to 0 decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium...
Please help!!! ASAP!! On January 1, 2018, King Corporation signed a $100,000, four-year, 9% note. The...
Please help!!! ASAP!!
On January 1, 2018, King Corporation signed a $100,000, four-year, 9% note. The loan required King to make payments annually on December 31 of $25,000 principal plus interest. 1. Journalize the issuance of the note on January 1, 2018. 2. Journalize the first payment on December 31, 2018. (Record debits first, then credits. Select explanations on the last line of the journal entry.) Journalize the issuance of the note on January 1, 2018 Date Accounts and Explanation...
On June 1, 2017, ABC INC approached XYZ Inc about buying a parcel of undeveloped land....
On June 1, 2017, ABC INC approached XYZ Inc about buying a parcel of undeveloped land. XYZ Inc was asking $240,000 for the land and ABC INC saw that there was some flexibility in the asking price. ABC INC did not have enough money to make a cash offer to XYZ Inc and proposed to give, in return for the land, a $300,000, five-year promissory note that bears interest at the rate of 4%. The interest is to be paid...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $480,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Your answer is correct. Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to 0 decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $590,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to o decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium Amortization On January 1,...
On January 1, 2018, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers under...
On January 1, 2018, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers under a two-year operating lease agreement from ComputerWorld Leasing, which routinely finances equipment for other firms at an annual interest rate of 6%. The contract calls for four rent payments of $14,000 each, payable semiannually on June 30 and December 31 each year. The computers were acquired by ComputerWorld at a cost of $98,000 and were expected to have a useful life of Seven years...
On January 1, 2018, MM Co. borrows $330,000 cash from a bank and in return signs an 4% installment note for five annual payments of $74,127 each, with the first payment due one year after the note is signed. 1. Prepare the journal entry to record issuance of the note 2. For the first $74127 annual payment at December 31, 2018, what amount goes toward interest expense? What amount goes toward principal reduction of the note? & Answer is complete...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $480,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Your answer is correct. Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to 0 decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium...
Please help!!! ASAP!!
On January 1, 2018, King Corporation signed a $100,000, four-year, 9% note. The loan required King to make payments annually on December 31 of $25,000 principal plus interest. 1. Journalize the issuance of the note on January 1, 2018. 2. Journalize the first payment on December 31, 2018. (Record debits first, then credits. Select explanations on the last line of the journal entry.) Journalize the issuance of the note on January 1, 2018 Date Accounts and Explanation...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $480,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Your answer is correct. Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to 0 decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium...
Question 2 On January 1, 2018, Carvel Corp. issued five-year bonds with a face value of $590,000 and a coupon interest rate of 6%, with interest payable semi-annually. (a) Prepare a partial bond amortization table for the first two interest payments assuming that interest is paid on July 1 and January 1 and that the bonds sold when the market interest rate was 5%. (Round answers to o decimal places, e.g. 5,255.) CARVEL CORP. Bond Premium Amortization On January 1,...
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