Liabilites
This type of liability is expected to be settled within one year or the company's operating cycle, whichever is longer.
What is current liabilites
This is a form of an Interest bearing note.
What is a bond?
This represents the amount of principal due at the maturity of the bond.
What is the face value or par value?
The journal entry for recording the sale of bond below face value.
What is:
Debit: Cash $xxxx
Debit: Discount on Bonds Payable $xxxx
Credit: Bond Payable $xxxxx
Bonds that can be exchanged for equity in the bond issuer.
What are callable bonds?
This liability occurs when a company receives cash in advance for goods or services to be provided in the future.
What is Unearned Revenue?
The rate of interest that a company agrees to pay bondholders annually on the bond's face value is called this.
What is the coupon rate or contract rate?
What is the market rate of interest?
The journal entry for recording the sale of bond below face value.
What is:
Debit: Cash $xxxx
Credit: Premium on Bonds Payable $xxxx
Credit: Bond Payable $xxxx
The equal amount process for spreading a discount or premium over the life of the bond.
What is the Straight Line Method?
These liabilities are not expected to be settled within the next year and are typically financed with long-term funding.
What are long-term liabilities?
The underlying contract between the company issuing bonds and the bondholders.
What is a bond indenture
When a bond is issued for less than its face value, it is said to be issued at this.
What is a discount?
What is amortization?
The amount received by the investor when the bonds mature.
What is bond proceeds?
A liability that can either be either current or long term depending on the due date.
What is a notes payable?
The two most common types of bonds.
What are term and serial bonds?
What is bond premium?
The calculation used to determine the amount of semiannual interest paid on a bond issued at a discount.
What is Face amount x coupon rate x 1/2?
This is the amount of interest the bondholder receives each year, based on the bond’s face value and coupon rate.
What is the annual interest payment?
When a company issues bonds, it records the liability under this account on the balance sheet.
What is bonds payable?
That rate of interest paid on similar bonds.
What is the market rate of interest or effective rate of interest?
This type of bond allows the issuing company to repay the bond before its maturity date, often at a premium.
What is a callable bond
The face amount of the bonds plus the balance of the premium on bonds payable or less the balance of the discounts on bonds payable.
What is carrying value?
The alternative method used to compute the amortization of a bond discount or premium.
What is the effective interest rate method?