Question

Semey loc la bonds outstarong that were issued at a premium The bonds were issued on lanzyl and pay interest on June 30 and December 31. At the beginning of the curent yez tę bonds hed a carrying value of $ 108000. The bords izie a face value of $ 8000. The bonds pay interest at an annual interest reds X Thematit rate on the bonds at the time they were issued was 6 %. The carreteraz on bonds is 10% Caltanterestepense for the yez on the bonds. Round your answer to the testa. Youkais

Answer 1

$ Carrying Value of Bond Face Value Interest Paid ($ 83,000 x 5%/2) $ $ 108,000 83,000 2,075 Period End 0 1 2 Amortization Schedule Bond Cash Int Interest Exp Premium Premium Carrying paid @ 2.5% @ 3% amortization Balance Value $ 25,000 $108,000 $ 2,075$ 3,240 $ 1,165 $ 23,835 $ 106,835 $ 2,075$ 3,205 $ 1,130 $ 22,705 $ 105,705 6,445 Interest Expense for the year $ 6,445

In case of any doubts or issues, please do comment below