Grider Industries, Inc. issued $10,000,000 of 8% debentures on May 1, 2014

Grider Industries, Inc. issued $10,000,000 of 8% debentures on May 1, 2014 and received cash totaling ,872,628.The bonds pay interest semiannually on May 1 and November 1. The maturity date on these bonds is November 1,2022. The firm uses the effective­interest method of amortizing discounts and premiums. The bonds were sold toyield an effective­interest rate of 10%.Calculate the total dollar amount of discount or premium amortization during the first year (5/1/14 through 4/30/15)these bonds were outstanding.Brief Exercise 147On August 31, Latty Co. partially refunded $467,000 of its outstanding 10% note payable made one year ago toDugan State Bank by paying $467,000 plus $46,700 interest, having obtained the $513,700 by using $136,960cash and signing a new one­year $414,000 note discounted at 9% by the bank.Make the entry to record the partial refunding. Assume Latty Co. makes reverPrepare the adjusting entry at December 31, assuming straight­line amortization of the discount.On June 1, 2013, Everly Bottle Company sold $2,000,000 in long­term bonds for $1,754,200. The bonds willmature in 10 years and have a stated interest rate of 8% and a yield rate of 10%. The bonds pay interestannually on May 31 of each year. The bonds are to be accounted for under the effective­interest method.Construct a bond amortization table for this problem to indicate the amount ofamortization at each May 31.Assuming that interest and discount amortization are recorded each May 31, prepare the adjusting entry to be madeon December 31, 2015Merritt Equipment Company sells computers for $1,300 each and also gives each customer a 2­year warrantythat requires the company to perform periodic services and to replace defective parts. During 2014, the companysold 950 computers. Based on past experience, the company has estimated the per unit 2­year warranty costsUnder the expense warranty approach, give the entries to reflect the above tr2014 and 2015.Under the cash­basis method, what are the Warranty Expense balances for 2014 and 2015?The transactions of part (a) create what balance under current liabilities in the 2014 balance sheet?

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