Questions from Intermediate Accounting

Q: On March 1, 2018, Brown-Ferring Corporation issued $

On March 1, 2018, Brown-Ferring Corporation issued $100 million of 12% bonds, dated January 1, 2018, for $99 million (plus accrued interest). The bonds mature on December 31, 2037, and pay interest se...

Q: At January 1, 2018, Transit Developments owed First City Bank

At January 1, 2018, Transit Developments owed First City Bank Group $600,000, under an 11% note with three years remaining to maturity. Due to financial difficulties, Transit was unable to pay the pre...

Q: At January 1, 2018, Brainard Industries, Inc., owed

At January 1, 2018, Brainard Industries, Inc., owed Second BancCorp $12 million under a 10% note due December 31, 2020. Interest was paid last on December 31, 2016. Brainard was experiencing severe fi...

Q: Your investment department has researched possible investments in corporate debt securities.

Your investment department has researched possible investments in corporate debt securities. Among the available investments are the following $100 million bond issues, each dated January 1, 2018. Pri...

Q: Determine the price of a $1 million bond issue under each

Determine the price of a $1 million bond issue under each of the following independent assumptions:

Q: The Bradford Company issued 10% bonds, dated January 1,

The Bradford Company issued 10% bonds, dated January 1, with a face amount of $80 million on January 1, 2018. The bonds mature on December 31, 2027 (10 years). For bonds of similar risk and maturity,...

Q: Myriad Solutions, Inc., issued 10% bonds, dated January

Myriad Solutions, Inc., issued 10% bonds, dated January 1, with a face amount of $320 million on January 1, 2018, for $283,294,720. The bonds mature on December 31, 2027 (10 years). For bonds of simil...

Q: The Gorman Group issued $900,000 of 13% bonds

The Gorman Group issued $900,000 of 13% bonds on June 30, 2018, for $967,707. The bonds were dated on June 30 and mature on June 30, 2038 (20 years). The market yield for bonds of similar risk and mat...

Q: Universal Foods issued 10% bonds, dated January 1, with

Universal Foods issued 10% bonds, dated January 1, with a face amount of $150 million on January 1, 2018. The bonds mature on December 31, 2032 (15 years). The market rate of interest for similar issu...

Q: The lessor’s initial direct costs often are substantial. What are initial

The lessor’s initial direct costs often are substantial. What are initial direct costs?