2.

(Information Related to Various Bond Issues) issued three types of debt on January 1, 2020, the start of the
company’s fiscal year.
a. $10 million, 10-year, 15% unsecured bonds, interest payable quarterly. Bonds were priced to yield 12%.
b. $25 million par of 10-year, zero-coupon bonds at a price to yield 12% per year.
c. $20 million, 10-year, 10% mortgage bonds, interest payable annually to yield 12%.
Prepare a schedule that identifies the following items for each bond: (1) maturity value, (2) number of interest periods
over life of bond, (3) stated rate per each interest period, (4) effective-interest rate per each interest period, (5)
payment amount per period, and (6) present value of bonds at date of issue.
Sr. Zero-coupon 10% Mortgage
Particular 15% UnsecuredBonds
no. Bonds Bonds

1 Maturity value $10,000,000 $25,000,000 $20,000,000

Number of interests
2 40 10 10
periods

(15%/4)
3 Stated rate per period 0 10%
3.75 %

(12%/4)
4 Effective rate per period 12% 12%
3%

Payment amount per $375,000 $2,000,000

5 0
period ($10,000,000x15%x1/4) ($20,000,000x10%)

6 Present value $11,733,639 $8,049,250 $17,739,840

Present value of an annuity of $375,000 discounted at 3% per period for 40

periods $8,668,039
($375,000×23.11477)

Present value of $10,000,000 discounted at 3% per period for 40 periods

3,065,600
($10,000,000×0.30656)

$11,733,639

Present value of $25,000,000 discounted at 12% per period for 10 periods at 12%
$8,049,250
($25,000,000×0.32197)

Present value of an annuity of $2,000,000 discounted at 12% per for 10 periods

$11,300,440
($2,000,000×5.65022)

Present value of $20,000,000 discounted at 12% per period for 10 years 6,439,400
($20,000,000×0.32197) Tổng $17,739,840
3. Peter Company sold the following bond on January 1, 2023: $100.000; 4% bonds due on 01/01/2028 with
payments semiannually on January 1 and July 1. The current market rate of interest on the date of sale was
6%. Assume the sales price was $91,470
Required:
1. Use the effective interest rate method of amortization to prepare the Schedule of Bond Discount
Amortization and explain number on the Schedule of Bond Discount Amortization
2. Prepare the journal entry at the date of the bond issuance and the interest payment and the
amortization for 2023.
Answer:
Cash Interest Discount Carrying Amount
Date Paid A Expense B Amortized C of Bonds D
1/1/2023 $91.470
7/1/2023 $2.000 $2.744 $744 $92.214
1/1/2024 $2.000 $2.766 $766 $92.980
7/1/2024 $2.000 $2.789 $789 $93.770
1/1/2025 $2.000 $2.813 $813 $94.583
7/1/2025 $2.000 $2.837 $837 $95.420
1/1/2026 $2.000 $2.863 $863 $96.283
7/1/2026 $2.000 $2.888 $888 $97.171
1/1/2027 $2.000 $2.915 $915 $98.087
7/1/2027 $2.000 $2.943 $943 $99.029
1/1/2028 $2.000 $2.971 $971 $100.000

A= 100,000 x 4% x 6/12 (nửa năm) cash paid= par value x started rate x time
B= D x 6% x 6/12 interest exp= carring amount x yield rate x time
C= B – A discount amortized= interest exp – cash paid
D= D + C new carring amount= previous + discount amor..
Câu 2
January 1,2023: Inssurance of Bonds at discount
DR cash 91,470
Dr discount bonds payable 8,530
Cr bonds payable 100,000
July 1, 2023: first interest payment and amortization
Dr interest expense 2,744
Cr discount on bonds paya.. 744
Cr cash 2,000
December 31,2023: interest expense accurued and amortization
Dr interest exp 2,766
Cr interest payable 766
Cr discount on bonds paya 2,000
4. During Year 1, Min Company incurred costs to develop and produce a routine, low – risk computer software
product, as described below:
Completion of detail program design: $12,000
Costs incurred for coding and testing to establish technological feasibility: $12,000.
Other coding costs after establishment of technological feasibility: $24,000
Other testing costs after establishment of technological feasibility: $19,000
Costs of producing product masters for training materials: $13,000
Duplication of computer software and training materials from product masters (1,000 units): $22,000
Packaging product (500 units) :$8,000
Instructions
1. In Min’s December 31, Year 1, balance sheet, what amount should be reported in inventory?
2. In Min’s 31/12, Year 1, balance sheet, what amount should be capitalized as software cost subject to amortiza
Giải
5. On June 2, Year 1,Ton Company issued $500,000 of 10%, 10 year bonds at par. Interest is payable
seminannually on June 1 and December 1. Bond issue costs were $9,000 and Ton uses the straight-line
method of amortizing bond issue costs. On June 2, Year 6, Tony retired half of the bonds at 98. What is the
net carring amount that Ton should use in computing the gain or loss on retirement of debt?
6. On January 1, 2023, Aumont Company sold 12% bonds having a maturity value of $500,000 for
$537,907.37, which provides the bondholders with a 10% yield. The bonds are dated January 1, 2023, and
mature January 1, 2028, with interest payable December 31 of each year. Aumont Company allocates
interest and unamortized discount or premium on the effective-interest basis.
a. Prepare the journal entry at the date of the bond issuance.
b. Prepare a schedule of interest expense and bond amortization for 2023–2025.
c. Prepare the journal entry to record the interest payment and the amortization for 2023,2024, 2025.

Date Account Title Debit Credit

01-Jan-23 Cash 537,907
Bond Payable 500,000
Premium on Bond Payable 37,907
(Being recorded issue of bond at premium)

Semi Annual- Premium

Interest to Interest Un Amortized Bond Carrying
Inetrest Period Amortizattion
be paid B Expenses C Premium E Value F
End A D=B-C

01-Jan-23 37907 537907

31-Dec-23 60,000 53791 6,209 31,698 531,698

(500000
(537907 X 10%) (37904-6209)
X12%)

31-Dec-24 60,000 53170 6,830 24,867 524,867

(500000
(531698X 10%) (31698-6830)
X12%)

31-Dec-25 60,000 52487 7,513 17,354 517,354

(24867-7513)
(524867 X 10%)

31-Dec-23 DR Interest Expenses 53,791

DRPremium on Bond Payable 6,209
CR Cash (Record of annual interest paymen and premium amortization) 60,000
CÁC NĂM CÒN LẠI VIẾT TƯƠNG TỰ THEO DÒNG TÔ CAM
7. On January 2, Pan Co acquired Shen Co in a business combination that resulted in recognition of goodwill of
$300,000 having an expected benefit period of 10 years. Shen is treated as a reporting unit, and the entire
amount of the recognized goodwill is assigned to it. During the first quarter of the year. Shen spent an
additional $50,000 on expenditures designed to maintain goodwill. Due to these expenditures, at December
31, Shen estimated that the benefit period of goodwill was 40 years.In its consolideted December 31 balance
sheet, what amount should Pan report as goodwill?
 a loss on discontinued operations (net of tax) of $1,200,000 in the first quarter when ít income before the
loss was $1,000,000
The average market price of common stock for the first quarter was $25, the shares outstanding at the
beginning of the period equaled 300,000 and 12,000 shares were issued on 1/3.
At the begining of the quarter, Can had outstanding $2,000,000 of 5% convertible bonds, with each
$1,000 bond convertible into 10 shares of common stock. No bonds were converted. 
At the begining of the quater, had out standing 120,000 shares of preferred stock paying a dividend of
$0,1 per share at the end of each quarter and convertible to common stock on a one-to-one basis. Holder
of 60,000 shares of preferred stock exercised their conversion privillege on 1/2.
Throughout the first quater, warants to buy 50,000 shares of Can’s common stock for $28 per share were
outstanding but unexercised. Can’s tax rate was 30%.
1. Compute basic earnings per share for net income or loss
 The weighted – average of shares used in the BEPS denominator is
300,000 cổ phiếu từ đầu quý+12,000 cổ phiếu từ tháng 3 *1/3 + 60,000 commonstock đc chuyển
đổi từ tháng 2*2/3 = 344,000.
 preferred dividends (120,000 preferred shares -60,000 preferred shares converted)X $0.1=$ 6,000
 The net income = $1,000,000 -1,200,000
 BEPS = $net income -$6,000 /344,000 = $(0.6)
2. WA number of shares used to calculate dilutive earning per share amounts for the first quarter.
 The incremental shares from assumed conversion of warrants is zezo because they are diluative
(The $25 market price < the $28 exercise price)
 The assumed conversion of all the preferred shares at the begining of the quater
80,000 incremental shares = (120,000X1/3 + 60,000 X2/3)
 The assumed conversion of all the bonds at the begining of the quarter
20,000 incremental shares = $2,000,000: $1,000 per bond *10 common shares per bond.
 The weight-average number of shares used to calculate dilutive earning per share amounts for
the first quarter = 344,000 + 0 +80,000 +20,000 = 444,000
3. Compute dilutive earning per share for net income or loss.
 The control number for determining whether potential common shares are dilutive of antidilutive
$1,000,000 – (120,000– 60,0000) X 0,1 = $994,000
 the dilutive earnings per share is ($994,000+$23,500-$1,200,000)/444,000 = $(0,41).
4. the effect of assumed conversions on the numerator of the dilutive earning per share fraction
 If all of the convertible preferred shares are assumed to be converted on January, $6,000 of
dividends will not paid.
 If the bonds are assumed to be converted on January 1, interest
(2,000,000X 5%/4) X (1-0.3) = $17,500 will not paid.
 The effect of assumed conversions on the numerator of the dilutive earning per share fraction
6,000 + 17,500 = $23,500.
P13.4