Hartford Research issues bonds dated January 1, 2013, that pay

Hartford Research issues bonds dated January 1, 2013, that pay
interest semiannually on June 30 and December 31. The bonds have
a $23,000 par value and an annual contract rate of 8%, and they
mature in 10 years. (Table B.1, Table B.2, Table B.3, and Table

B.4) (Use appropriate factor(s) from the tables provided. Round
all table values to 4 decimal places, and use the rounded table
values in calculations.)
Required:
Consider each of the following three separate situations.
1.The market rate at the date of issuance is 6%.
(a Complete the below table to determine the bonds' issue price on
) January 1, 2013.

Table values are based on:

(b Prepare the journal entry to record their issuance.
n=
)

i=
Cash Flow


Table Value Amount Present Value

Par (maturity) value
Interest (annuity)

Record the issue of bonds
with a par value of $23,000
cash on January 1, 2013.
Assume that the market
rate of interest at the date

Price of bonds
of issue is 6%.



Journal Entry Worksheet

Jan. 1,2013
Cash 23,000
Debit
o Bonds payable
23,000
Credit
o Premium on bonds payable ?
Credit
2. The market rate at the date of issuance is 8%.
(a Complete the below table to determine the bonds' issue price on
) January 1, 2013.

Table values are based on:
n=
i=
Cash Flow

Table Value Amount Present Value

Par (maturity) value
Interest (annuity)
Price of bonds



b)Prepare the journal entry to record their issuance.
Record the issue of bonds with a par value of $23,000 cash on January 1, 2013.
Assume that the market rate of interest at the date of issue is 8%.
3.The market rate at the date of issuance is 10%.

(a Complete the below table to determine the bonds' issue price on
) January 1, 2013.

Table values are based on:
n=
i=
Cash Flow

Table Value Amount Present Value

Par (maturity) value
Interest (annuity)
Price of bonds
(b
Prepare the journal entry to record their issuance.
)
Record the issue of bonds with a par value of
$23,000 cash on January 1, 2013. Assume that the market
rate of interest at the date of issue is 10%.