Amortization of a Bond Premium or Discount

Amortization of a Bond Premium or Discount - Amortization...

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Amortization of a Bond Premium or Discount Below is information about a bond that a company issued. Date Cash Interest Amortization 111/X1 12/31/X1 8,000 6,505.75 1,494.25 12/31/X2 8,000 6,416.10 1,583.90 12/31/X3 8,000 6,321.06 1,678.94 12/31/X4 8,000 6,220.33 1,779.67 12/31/X5 8,000 6,107.56 1,892.44 1. What is the stated interest rate? 2. What was the effective (market) interest rate? CPOJo 3. What is the par value of the bonds? JCD;cco 4. At what price were the bonds issued? IO~{Jt. ct.lo 5. What was the interest expense for 20X4? C!J~?JJ ,~~ ' 6. Was the bond issued at a premium or discount? Net Liability 108,429.20 106,934.95 105,351.05 103,672.11 101,892.44 [ 100,000.00 1 ~Y"Vevlv~
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