On January 1, 2021, White Water issues $410,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year.

Assuming the market interest rate on the issue date is 8%, the bonds will issue at $382,141.

Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Round your final answers to the nearest whole dollar.)

On January 1, 2021, White Water Issues $410,000 Of 7% Bonds, Due In 10 Years, With Interest Payable Semiannually

Answers

Answer 1

Answer:

Step-by-step explanation:

On January 1, 2021, White Water Issues $410,000 Of 7% Bonds, Due In 10 Years, With Interest Payable Semiannually
Answer 2

The appropriate journal entries to record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021 are:

White Water journal entries

1-Jan-21

Debit Cash $382,141

Credit Discount on Bonds Payable $27,859

($410,000-$382,141)

Credit Bonds payable  $ 410,000

30-Jun

Debit Interest Expenses $ 15,286

($382,141 x 8%/2)  

Debit Discount on Bonds Payable $736

Credit Cash $14,350

($410,000 x 7%/2)  

31-Dec

Debit Interest Expenses $15,315.08

[($382,141 + 736) x 8%/2]

Credit Discount on Bonds Payable $965.08

($15,315.08-$14,350)

Credit Cash $14,350

($410,000 x 7%/2)

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Binomial Distribution Problem 1: (a) An urn contains 1000 balls, 100 are green and 900 are white. One ball is chosen from the urn 100 times with replacement. Use Excel (binom.dist) to find the probability that six or seven green balls are selected. (b) An urn contains 1000 balls, 100 are green and 900 are white. One ball is chosen from the urn 1000 times. Use Excel (binom.dist) to find the probability that between 110 and 120 of the balls, inclusive, are green. (c) Redo (a) and (b) again using Excel but use the normal approximation (normal.dist). How do the answers compare with the above? Are there any discrepancies? If so, please explain why they happened. Please submit your answers on an excel spreadsheet.

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Find the attachments for solution and explanation

The student's question regards calculating binomial probabilities and normal approximations using Excel. Precise probabilities are found using the BINOM.DIST function, and normal approximations are made with NORM.DIST. Discrepancies can arise due to the approximation not perfectly representing the discrete binomial outcomes.

In solving problems using binomial probabilities with Excel, the function =BINOM.DIST(number_s, trials, probability_s, cumulative) is used to calculate the probability of a specified number of successes in a series of independent trials. In problem (a), to find the probability that six or seven green balls are selected, we would use =BINOM.DIST(6, 100, 0.1, FALSE) and =BINOM.DIST(7, 100, 0.1, FALSE) adding both probabilities together. For problem (b), to find the probability that between 110 and 120 green balls are chosen, we calculate the cumulative probability for 120 and subtract the cumulative probability for 109 using =BINOM.DIST(120, 1000, 0.1, TRUE) - BINOM.DIST(109, 1000, 0.1, TRUE).

The normal approximation can be applied to the binomial distribution when the number of trials is large and the success probability is not too close to 0 or 1, using Excel's =NORM.DIST(x, mean, standard_dev, cumulative) function. Comparing the results of the normal approximation with the exact binomial probabilities may reveal discrepancies due to the approximation being less accurate for probabilities that are far from the mean, especially when the success probability (p) is not near 0.5, or when the number of trials (n) is not large enough. These discrepancies are due to the smooth curve assumption in the normal distribution approximation, which may not perfectly represent the discrete nature of binomial outcomes.

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