[skinnyb111]

so i am going through my review of bonds and i have a question. Many times during the extingusihment of bonds they ask you to calculate the unamoritzed premium or discount. Here is the information i have:

1. On January 2, Year 1 the Lyndhurst Company, Inc a privately held company issued 1,000,000 five year 10% bonds dated January 2, year 1. The bonds provided for semi annual interest payments to be made on June 30 and December 31 of each year. Terms of the bond indenture allowed the company to call the bonds at 102 after one year (June 30, year 2). The bonds were issued when the market interest rate was 8.00 %. The company uses the effective interest method for amortizing bond discounts and premium.

What is the calculated Gain/Loss?

I know the Requisition price is 1,020,000

Given the information above, how do you calculate the CV?

[mjp44]

I think you need to calculate the present value of the proceeds first inorder to calculate the carrying value of bonds via the effective interest method. Which test bank is this question from?

FAR- PASSED (11/13)
REG- PASSED (2/14)
BEC- PASSED (5/14)
AUD- PASSED (8/14)

If it's important to you, you will find a way. If it isn't, you will find an excuse.

[mjp44]

I think you need to calculate the present value of the proceeds first inorder to calculate the carrying value of bonds via the effective interest method. Which test bank is this question from?

FAR- PASSED (11/13)
REG- PASSED (2/14)
BEC- PASSED (5/14)
AUD- PASSED (8/14)

If it's important to you, you will find a way. If it isn't, you will find an excuse.

[Author]

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