11On January 1, 2013, Davie Services issued $20,000 of 8% bonds that mature in five years. They were sold at a premium, for a total of $20,750, on January 1, 2018. When the bonds mature, Davie Services will make the final principal payment. That entry will include which of the following:
A) Debit Bond premium for $250 and credit Cash for $250.
B) Debit Bonds payable for $20,750 and credit Cash for $20,750.
C) Debit Bonds payable for $20,000 and credit Cash for $20,000.
D) Debit Bonds payable for $20,000, credit Bond premium for $750, and credit Cash for $19,250.
12On January 1, 2013, Davie Services issued $20,000 of 8% bonds that mature in five years. They were sold at par. The bonds pay semiannual interest payments on June 30 and December 31 of each year. On June 30, 2013, how much is the total interest payments made to bondholders?
A) $ 800.00
B) $1,600.00
C) $ 160.00
D) $ 133.33
13On January 1, 2013, Davie Services issued $20,000 of 8% bonds that mature in five years. They were sold at a discount, for a total of $19,000. The bonds pay semiannual interest payments on June 30 and December 31 of each year. On June 30, 2013, how much is the total amount paid to bondholders?
A) $ 253.33
B) $1,520.00
C) $ 760.00
D) $ 800.00
14On January 1, 2013, Davie Services issued $20,000 of 8% bonds that mature in five years. They were sold at a premium, for a total of $20,750. The bonds pay semiannual interest payments on June 30 and December 31 of each year. On June 30, 2013, how much is the total amount paid to bondholders?
A) $ 276.67
B) $ 800.00
C) $1,660.00
D) $ 830.00
15The balance in the Bonds payable account is a credit of $50,000. The balance in the Discount on bonds payable account is a debit of $1,500. How much is the bond carrying amount?
A) $ 1,500
B) $50,000
C) $51,500
D) $48,500
Calculation $50,000 - $1,500 = $48,500
16On December 31, 2013, Peterson Sales has a Bonds payable balance of $40,000 and a Discount on bonds payable of $2,100. On the balance sheet, how will this information be shown?
A)$40,000 less discount of $2,100 for a net balance of $37,900
B)$40,000 plus discount for a total balance of $42,100
C)$40,000 only
D)$40,000 less one-tenth of $2,100 for a net balance of $39,790
17The balance in the Bonds payable account is a credit of $50,000. The balance in the Premium on bonds payable account is a credit of $900. How much is the bond carrying amount?
A) $ 900
B) $50,900
C) $51,900
D) $49,100
18On December 31, 2013, Peterson Sales has a bonds payable balance of $40,000 and a premium on bonds payable of $900. On the balance sheet, how will this information be shown?
A)$40,000 less premium of $900 for a net balance of $39,100
B)$40,000 less one-tenth of $900 for a net balance of $39,910
C)$40,000 only
D)$40,000 plus a premium of $900 for a net balance of $40,900
19On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9,400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. On June 30, 2014, when Mahoney makes the first payment to bondholders, how much will they report as interest expense?
A) $200
B) $260
C) $ 60
D) $400
20On January 2, 2014, Mahoney Sales issued $10,000 in bonds for $9,400. They were 5-year bonds with a stated rate of 4%, and pay semiannual interest payments. Mahoney Sales uses the straight-line method to amortize the bond discount. Immediately after issue of the bonds, the ledger balances appeared as follows:
Bonds payable
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Discount on bonds payable
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10,000
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600
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After the first interest payment on June 30, 2014, what was the balance in the discount account?
A) Debit of $540
B) Debit of $600
C) Debit of $660
D) Credit of $60