Essay on Acc 206 Week 2 Assignment Chapter Two and Three Problems

1050 Words Nov 4th, 2014 5 Pages
ACC 206 Week 2 Assignment Chapter Two and Three Problems
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ACC 206 Week 2 Assignment Chapter Two and Three Problems
Please complete the following 7 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the
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By what amount?
Chapter 2 Problem 1
1. Bond computations: Straight-line amortization
Southlake Corporation issued $900,000 of 8% bonds on March 1, 20X1. The bonds pay interest on March 1 and September 1 and mature in 10 years. Assume the independent cases that follow.
Case A—The bonds are issued at 100.•
Case B—The bonds are issued at 96.•
Case C—The bonds are issued at 105.•
Southlake uses the straight-line method of amortization.
Instructions:
Complete the following table:
Case A
Case B
Case C
Cash inflow on the issuance date
_______
_______
_______
Total cash outflow through maturity
_______
_______
_______
Total borrowing cost over the life of the bond issue
_______
_______
_______
Interest expense for the year ended December 31, 20X1
_______
_______
_______
Amortization for the year ended December 31, 20X1
_______
_______
_______
Unamortized premium as of December 31, 20X1
_______
_______
_______
Unamortized discount as of December 31, 20X1
_______
_______
_______
Bond carrying value as of December 31, 20X1
_______
_______
_______
Chapter 3 Exercise 1
1. Product costs and period costs
The costs that follow were extracted from the accounting records of several different manufacturers:
1. Weekly wages of an equipment maintenance worker
2. Marketing costs of a soft drink bottler
3. Cost of sheet metal in a Honda automobile
4. Cost of president’s subscription to Fortune magazine
5.

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