Homework: 9-1 MyAccounting Lab: Module Nine Homework Save Score: 0 of 2 pts 16 o

Question

Homework: 9-1 MyAccounting Lab: Module Nine Homework Save Score: 0 of 2 pts 16 of 36 (30 complete) Hw Score: 76%, 57 of 75 pts X QC9-16 (similar to) EQuestion Help McCoy Corporation issued $150,000 of 6.0% 10-year bonds The bonds are dated and sold on January 1, 2015. Interest payment dates are January 1 and July 1. The bonds are issued for $139,341 to yield the market interest rate of 7%. On the first semiannual interest payment date, July 1, 2015, the company recorded S4,877 in interest expense and $377 in discount amortization. The interest payment is $4,500. Using the effective-interest method, what is the carrying amount of the bonds on the January 1, 2016 balance sheet? A. $139,718 OB. $150,000 OC. $139,341 O D. $140,108

Explanation / Answer

Answer is 328595

C 9-15

Answer is B 6500

Interest payment = Maturity Value of bonds x Stated interest rate

=100000*6.5%

=6500

Discount on Issue 350000-326217 23783 Discount Amortization annually 23783/10 2378 Carrying Value of Bond 326217+2378 328595

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