Course Description

The self-study details the basics of accounting for the issue of bonds; covering bonds issued at a discount and premium, the basis for reporting the obligation on the balance sheet, calculation of interest and the cash flows related to the debt. The program goes deeper into understanding the amortized cost of bonds versus fair value and accounting for the early retirement of bonds. This program covers accounting for convertible bonds and warrants.

Broderick Associates

Chris Broderick

CHRIS BRODERICK, as the primary principal of Broderick Associates, Chris Broderick translates his experience as a financial analyst to the teaching of accounting and financial statement analysis. Chris is a second-generation instructor of this family-run enterprise beginning his teaching in 1995 in association with his father. Since 1986 as a analyst with Chase Manhattan Bank, Chris has a broad expertise in international credit analysis traveling throughout the globe from his base in the New York and London offices. Later in 1989 he began training within Chase on a worldwide platform. Since joining Broderick Associates, he has trained employees with HSBC, JP Morgan Chase, TD Bank among others; both locally and globally. Throughout his career, he has also been aligned with various colleges and universities.

Course curriculum

  • 1

    Introduction, Course Objectives, Prerequisite Knowledge Required, Contents

  • 2

    Section 1 Introduction to Bonds Payable

  • 3

    Section 2 Accounting for Bonds Payable

    • Bonds Issued at Par, Discount or Premium

    • Accounting for Bonds Issued at Face Value

    • Accounting for Bonds Issued at a Discount

    • Exercise 1

    • Solution: Exercise 1

    • Accounting for Bonds with Semi-annual Coupon and Interest

    • Example: Accounting for Bonds Issued at Discount (semi-annual coupon payments)

    • Exercise 2

    • Solution: Exercise 2

    • Accounting for Bonds Issued at a Premium

    • Exercise 3

    • Solution: Exercise 3
  • 4

    Section 3: Redemption of Bond Issue Prior to Maturity Date

    • Bond Retirement Prior to Maturity

    • Accounting for Redemption of Bonds at a Loss

    • Accounting for Redemption of Bonds at a Gain

    • Exercise 4

    • Solution: Exercise 4
  • 5

    Section 4: Accounting for Hybrid Securities

    • Accounting for Convertible Bonds (no beneficial conversion)

    • Exercise 5

    • Solution: Exercise 5

    • Accounting for Convertible Bonds (beneficial conversion)

    • Bonds with Detachable Warrants
  • 6

    Practice Problems

    • Problem 1

    • Solution: Problem 1

    • Problem 2

    • Solution: Problem 2

    • Problem 3

    • Solution: Problem 3

    • Problem 4

    • Solution: Problem 4