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View Full Version : Accounting Help


inayatcr17
Feb 17, 2013, 09:34 PM
On April 1, 2013, Darden Corporation, parent company of Oliver Garden, Red Lobster, Longhorn Steakhouse, and Bahama Breeze, authorized the sale of $8,000,000 of 8% bonds with interest payment dates April 1 and October 1. The bonds were sold on July 1, 2013 and mature on April 1, 2023. The bonds were sold when market rates of interest were 10%. The premium/discount is amortized using the effective interest method.

(1) What is present value of the principle and interest payment?

(2) Determine if its premium or discount?

(3) Journal entries on the issuers books including any accrued interest, to record sale of the bonds on July 1.

(4) Journal entries on the investor's books including any accrual interest, to record purchase of the bonds on July 1.

(5) Journal entries on issuers books to record interest payment on October 1, including any related premium or discount amortization.

(6) Journal entries on investor books to record interest revenue on October 1, including any related premium or discount amortization

(7) Journal entries on the issuer's books to record the interest accrual on December 31, including any related premium or discount.

(8) Record the reacquisition and extinguishment of the bonds on the issuer's books at 101 on April 1, 2014, plus accrued interest.

paraclete
Feb 17, 2013, 09:48 PM
You need to show us your attempts at this assignment or state specifically which concepts you have difficulty with. You can't just post a question and expect us to give you a model answer