Use the following to answer questions 11-15 Presented below is a partial amortiz

Question

Use the following to answer questions 11-15 Presented below is a partial amortization schedule for Delta Corp: carrying value 5100.739.51 Period Interest expense @ 5.90% interest payment @ 6.00% Amortization Issue date $6,000.00 $6,000.00 $5,943.63 100,683.14 12. 13. Determine the missing amounts: 11. S (rounded) Determine the amount for interest expense for the 2nd interest payment. 12. S(rounded) Determine the amortization amount for the 2nd interest payment. 13. _(rounded) Determine the carrying value after the 2nd interest payment. 14. $How much cash did the company receive at issuance? 15. Was the bond issued at face, premium or discount?

Explanation / Answer

11. It will be computed as 100,683.14 * 5.90%= $5940.30

12. AMortization amount can be calculated as 6000- 5940.30= $59.70

13. Carrying value for 2nd Interest payment can be calculated as Last Carrying value deducted by amortization amount= 100683.41-59.70 = $100623.7

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