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Sunday, November 14, 2010

Valix Finacc vol 1 Problem 12-12

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 1 Problem 12-12


Year                                         Bond outstanding        Fraction        Discount amortization

2008                                               4,000,000                  4/10                         120,000
2009                                               3,000,000                  3/10                           90,000
2010                                              2,000,000                   2/10                         60,000
2011                                              1,000,000                   1/10                          30,000
                                                    10,000,000                                                  300,000

   2010
Dec. 31   Cash                                                                                     240,000
                        Interest income                                                                                               240,000

         31   Held to maturity securities                                                     60,000
                        Interest income                                                                                                 60,000
                                                                                                            
         31   Cash                                                                                              1,000,000
                        Held to maturity securities                                                                 1,000,000

   2011
Dec. 31   Cash                                                                                     120,000
                        Interest income                                                                                               120,000

         31   Held to maturity securities                                                     30,000
                        Interest income                                                                                                 30,000

         31   Cash                                                                                             1,000,000
                        Held to maturity securities                                                                 1,000,000

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