Student Name:
Class:
Date Account Debit Credit
(Pay semiannual interest)
December 31, 2021
Interest Expense
Discount on Bonds Payable
Discount on Bonds Payable
(Pay semiannual interest)
(Pay semiannual interest)
(Pay semiannual interest)
December 31, 2021
Interest Expense
Premium on Bonds Payable
Cash
Premium on Bonds Payable
June 30, 2021
Interest Expense
600,000
600,000 <–Correct!
544,795
55,205
600,000 <–Correct!
664,065
600,000
64,065 <–Correct!
(Bonds issued at a discount)
Discount on Bonds Payable
(Issued bonds at a premium)
Requirement 2:
(Issued bonds at face amount)
Problem 09-04
McGraw-Hill/Irwin
Instructor
Bonds Payable
TWISTER ENTERPRISES
January 1, 2021
Cash
Requirement 1:
January 1, 2021
Cash
Bonds Payable
Premium on Bonds Payable
January 1, 2021
Cash
Requirement 3:
Bonds Payable
(Pay semiannual interest)
June 30, 2021
Interest Expense
Cash
(Pay semiannual interest)
December 31, 2021
Interest Expense
Cash
600,000$
TWISTER ENTERPRISES
Issued bonds on January 1, 2021
Interest rate on bonds
Interest payable June 30 and December 31
Maturity in years
Student Name:
Class:
Increase in
Cash Interest Carrying Carrying
Date Paid Expense Value Value
1/1/21 841,464$ «-Correct!
Date Account Debit Credit
Discount on Bonds Payable
Bonds Payable
Interest Expense
December 31, 2021
Discount on Bonds Payable
841,464
37,866
1,866 «- Correct!
Requirement 2:
January 1, 2021
June 30, 2021
Requirement 3:
Instructor
UNIVERSE OF FUN
Requirement 1: Amortization schedule
Interest Expense
Cash
Problem 09-06
McGraw-Hill/Irwin
Discount on Bonds Payable
900,000$
841,464$
UNIVERSE OF FUN
Given Data P09-06:
Issued bonds on January 1, 2021, face value
Bonds issued for
Interest rate on bonds
Interest rate for bonds of similar risk and maturity
Interest payable June 30 and December 31
Maturity in years
Student Name:
Class:
562$ 9,210.5$ 6.1% «- Correct!
Caribbean Key
Bahama Bay
880$ 170$ 5.2 «- Correct!
166$ 70$ 2.4 «- Correct!
Caribbean Key
Net Income+
Interest+
Taxes
Times
Interest
Earned Ratio
Requirement 3: (in $millions)
=
Requirement 1: (in $millions)
Bahama Bay
Total
Liabilities
Problem 09-08
McGraw-Hill/Irwin
Instructor
÷
Interest
÷
Average Total
Assets
BAHAMA BAY and CARIBBEAN KEY
Debt to
Equity Ratio
Net Income
Return on
Assets Ratio
=
÷
Stockholders’
Equity
=
Requirement 2: (in $millions)
Caribbean Key
Bahama Bay
2021 2020 2021 2020
8,861$ 9,560$ 7,640$ 7,507$
5,724 6,606 2,819 2,689
Total assets
Total liabilities
Bahama Bay
Caribbean Key
(In $millions)
BAHAMA BAY and CARIBBEAN KEY
Interest expense
Tax expense
Net income
Total stockholders’ equity
Sales revenue