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  3. on february 1 2018 cromley motor products issued 10 bonds...

Question: on february 1 2018 cromley motor products issued 10 bonds...

Question details

On February 1, 2018, Cromley Motor Products issued 10% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2022 (4 years). The market yield for bonds of similar risk and maturity was 12%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $60,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required 1. Determine the price of the bonds issued on February 1, 2018. 2-a. Prepare amortization schedules that indicate Cromleys effective interest expense for each interest period during the term to maturity. 2-b. Prepare amortization schedules that indicate Barnwells effective interest revenue for each interest period durin Э the term to maturity. 3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwells investment on February 1, 2018 4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2020.Complete this question by entering your answers in the tabs below Req 1 Req 2A Req 2B Req 3 Req 4 Cromley Req 4 Barnwell Determine the price of the bonds issued on February 1, 2018. (Enter your answer in whole dollars.) Price of the bondsComplete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 3 Req 4 Cromley Req 4 Barnwell Prepare amortization schedules that indicate Cromleys effective interest expense for each interest period during the term to maturity. (Enter your answers in whole dollars.) Payment Number Outstandin Balance Cash PaymentEffective Interest Inc rease in Balance 2 4 7 Totals $ 0 K Req Req 2B>Req 1 Req 2A Req 2B Req 3 Req 4 Cromley Req 4 Barnwell Prepare amortization schedules that indicate Barnwells effective interest revenue for each interest period during the term to maturity. (Enter your answers in whole dollars.) Payment Cash Payment Interest Increase in Outstanding Balance Balance 2 4 6 8 Totals $ < Req 2A Req3>Req 1 Req 2A Req 2B Req 3 EReq 4 Cromley Req 4 Barnwel Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwells investment on February 1, 2018. (If no entry is required for a transaction/event, select No journal entry required in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet Record the issuance of the bonds by Cromley Note: Enter debits before credits. Date General Journal Debit Credit February 01, 2018 Record entry Clear entry View general journalReq 1 Req 2A Req 2B Req 3 Req 4 Cromley Req 4 Barnwell Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2020. (If no entry is required for a transaction/event, select No journal entry required in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 2 4 6 Record the payment of interest for Cromley Company. Note: Enter debits before credits Date General Journal Debit Credit July 31, 2018 Record entry Clear entry View general journalReq 1 Req 2A Req 2B Req 3 Req 4 Cromley Req 4 Barnwell Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2020. (If no entry is required for a transaction/event, select No journal entry required in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 2 3 4 6 Record the receipt of interest for Barnwell Company. Note: Enter debits before credits. Date General Journal Debit Credit July 31, 2018 Record entry Clear entry View general journal

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