Net Work Corporation, whose annual accounting period ends on December 31, issued

Question

Net Work Corporation, whose annual accounting period ends on December 31, issued the following bonds: Date of bonds: January 1, 2015 Maturity amount and date: $230,000 due in 10 years (December 31, 2024) Interest: 11.5 percent per year payable each December 31 Date issued: January 1, 2015 Required For each of the three independent cases that follow, provide the following amounts to be reported on the January 1, 2015, financial statements immediately after the bonds were issued: (Amounts to be deducted should be indicated by a minus sign.) Case A Case B (issued at 100)(at 98) Case C (at 102) January 1, 2015-Financial Statements: a. Bonds payable b. Unamortized premium (or discount) C. Carrying value

Explanation / Answer

January 1,2015 --Financial Statements Case A Case B Case C (at 100) (at 98) (at 102) a. Bonds Payable 230,000 230,000 230,000 b. Unamortized premium(or discount) 0 -4600 4600 c. Carrying value 230,000 225,400 234,600

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