Answer Happy

Marin Co. is building a new hockey arena at a cost of $2,620,000. It received a downpayment of $450,000 from local businesses to support the project, and now needs to borrow $2,170,000 to complete the project. It therefore decides to issue $2,170,000 of 10%, 10-year bonds. These bonds were issued on January 1, 2019, and pay interest annually on each January 1. The bonds yield 9%. (a) Your answer is partially correct. Prepare the journal entry to record the issuance of the bonds on January 1, 2019. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation January 1, 2019 Cash Bonds Payable Premium on Bonds Payable Debit Credit 2,170,000

(a) (b) (c) 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. (Round stated and effective rate per period to 2 decimal places, e.g. 10.25%. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971.) (1) (2) (3) (4) (5) $10 million, 12-year, 15% unsecured bonds, interest payable quarterly. Bonds were priced to yield 11%. $25 million par of 12-year, zero-coupon bonds at a price to yield 11% per year. $16 million, 12-year, 10% mortgage bonds, interest payable annually to yield 11%. (6) Maturity value Number of interest periods Stated rate per period Effective rate per period Payment amount per period Present value $ $ $ Unsecured Bonds % % $ $ $ Zero-Coupon Bonds % % $ $ $ Mortgage Bonds % %