On January 1, 2019, Shay Company issues $350,000 of 10%, 15-year bonds. The bonds sell for $342,125. Six years later, on January 1, 2025, Shay retires these bonds by buying them on the open market for $365,750. All interest is accounted for and paid through December 31, 2024, the day before the purchase. The straight-line method is used to amortize any bond discount. 1. What is the amount of the discount on the bonds at issuance? 2. How much amortization of the discount is recorded on the bonds for the entire period from January 1, 2019, through December 31, 2024? 3. What is the carrying (book) value of the bonds as of the close of business on December 31, 2024? 4. Prepare the journal entry to record the bond retirement.

Colah company purchased $1.8 million of jackson, inc. 8% bonds at par on july 1, 2018, with interest paid semi-annually. when the bonds were acquired colah decided to elect the fair value option for accounting for its investment. at december 31, 2018, the jackson bonds had a fair value of $2.08 million. colah sold the jackson bonds on july 1, 2019 for $1,620,000. the purchase of the jackson bonds on july 1. interest revenue for the last half of 2018. any year-end 2018 adjusting entries. interest revenue for the first half of 2019. any entry or entries necessary upon sale of the jackson bonds on july 1, 2019. required: 1. prepare colah's journal entries for above transaction.

Iam trying to get more members on my blog. how do i do this?

Afirm's before-tax cost of debt, rd, is the interest rate that the firm must pay on debt. because interest is tax deductible, the relevant cost of debt used to calculate a firm's wacc is the cost of debt, rd (1 – t). the cost of debt is used in calculating the wacc because we are interested in maximizing the value of the firm's stock, and the stock price depends on cash flows. it is important to emphasize that the cost of debt is the interest rate on debt, not debt because our primary concern with the cost of capital is its use in capital budgeting decisions. the rate at which the firm has borrowed in the past is because we need to know the cost of capital. for these reasons, the on outstanding debt (which reflects current market conditions) is a better measure of the cost of debt than the . the on the company's -term debt is generally used to calculate the cost of debt because more often than not, the capital is being raised to fund -term projects. quantitative problem: 5 years ago, barton industries issued 25-year noncallable, semiannual bonds with a $1,600 face value and a 8% coupon, semiannual payment ($64 payment every 6 months). the bonds currently sell for $845.87. if the firm's marginal tax rate is 40%, what is the firm's after-tax cost of debt? round your answer to 2 decimal places. do not round intermediate calcu