Exercise 14-15 Straight-Line: Amortization and accrued bond interest expense LO

Question

Exercise 14-15 Straight-Line: Amortization and accrued bond interest expense LO P2 The following Information applies to the questions displayed below Duval Co. Issues four-year bonds with a $106,000 par value on January 1, 2017, at a price of $100,944. The annual contract rate is 8%, and Interest is paid semiannually on June 30 and December 31 Exercise 14-15 Part 1 1. Prepare an amortization table for these bonds. Use the stralght-line method of Interest amortization. (Round your answers to the nearest dollar amount.) Carrying Semiannual Unamortized Period-End 1/01/2017 /30/2017 12/31/2017 /30/2018 12/31/2018 /30/2019 12/31/2019 /30/2020 12/31/2020 Discount Value

Explanation / Answer

1) Prepare amortizaiton Table :

Semiannual period end Unamortized discount Carrying value 01/01/2017 5056 100944 6/30/2017 4424 101576 12/31/2017 3792 102208 6/30/2018 3160 102840 12/31/2018 2528 103472 6/30/2019 1896 104104 12/31/2019 1264 104736 6/30/2020 632 105368 12/31/2020 0 106000

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