About This Chapter
Accounting for Bonds & Notes Payable - Chapter Summary
Entertaining lessons in this chapter enable you to grasp the basics of accounting for bonds payable and notes payable with ease. Expert instructors closely examine bonds, bond valuation, how to record the retirement of bonds and more while keeping you engaged. Review these lessons anytime using any computer or mobile device with an Internet connection. When ready, assess your comprehension by taking short quizzes and a chapter exam. If you have questions about specific lesson topics, feel free to send them to our experts. In no time, you will be ready to:
- Define long-term liabilities and annuities and explain how they are measured
- Share examples of long-term liabilities and explain how to account for them
- List types, characteristics and the issuing procedures of bonds
- Discuss bonds and their investment performance over time
- Explain the advantages and disadvantages of issuing bonds at a discount or premium
- Detail the steps involved in bond valuation
- Record the retirement of a bond at maturity
- Demonstrate the accounting for interest- and non-interest bearing notes
- Exhibit knowledge of accounting for notes issued, bonds and notes payable
1. Measuring Long-Term Liabilities & Annuities
In this lesson, we'll define long-term liabilities and annuities. We'll provide an example of a long-term liability annuity and discuss how it's measured.
2. Accounting for Long-Term Liabilities
In this lesson, we'll define long-term liabilities and discuss four examples: bonds, pensions, long-term leases and mortgages. You'll also learn how to account for these types of long-term liabilities.
3. Bonds: Types, Characteristics and Issuing Procedures
In this lesson, you will learn about some of the more common types of bonds and their characteristics. Bonds include: secured and unsecured bonds, term and serial bonds, registered and bearer bonds, and convertible and callable bonds.
4. Issuing Bonds at a Discount or a Premium
In this lesson, we'll define a bond and discuss how bonds are issued at a premium and discount. You'll also learn the advantages and disadvantages of each.
5. Bond Valuation: Formula, Steps & Examples
In this lesson, you'll learn the steps required to determine the value of a bond. You'll also learn how to come up with an appropriate discount rate to use in the bond value calculation.
6. How to Record the Retirement of Bonds
In this lesson, we'll define bonds and discuss their components and the callable feature. You'll also learn how to record a retired bond at maturity and see the difference in recording a gain or loss.
7. Accounting for Non-Interest & Interest-Bearing Notes
In this lesson, you will learn how to account for interest-bearing and non-interest bearing notes. We will walk through the journal entries as we try and decide which bank, First National Bank or Ordinary Bank, we wish to borrow money from to start a food truck business.
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Other chapters within the Accounting 202: Intermediate Accounting II course
- Accounting for Fixed & Intangible Assets
- Accounting for Securities & Investments
- Accounting for Liabilities & Contingencies
- Accounting for Operating & Capital Leases
- Accounting for Shareholder Equity & Comprehensive Income
- Cash Flows & Disclosures
- Accounting for Corporate Income Taxes
- Pensions & Post-Retirement Benefits
- Identifying & Correcting Errors in Accounting
- Studying for Accounting 202