The following information applies to the questions displayed below. 0 years with

Question

The following information applies to the questions displayed below. 0 years with interest payable se a nu a y on June 30 and December 3 each year. The market On January 1, 2018 white Water issues $600 000 o 7% bonds, due in issued at $644,632. rest ti on he s ue date s % and the bonds Required information 1.25 points Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $633,887 on December 31, 2020. ate h PaldExpense Carrying ValueValue 01/01/18 6/30/18 12/31/18 6/30/19 12/31/19 6/30/20 12/31/20

Explanation / Answer

1) Date Cash interest Decrease Carrying paid expense in CV value 3.50% 3% 1/1/2018 644,632 6/30/2018 21000 19339 1661 642971 12/31/2018 21,000 19289 1711 641260 6/30/2019 21,000 19238 1762 639498 12/31/2019 21,000 19185 1815 637683 6/30/2020 21,000 19130 1870 635813 12/31/2020 21,000 19074 1926 633887 10744 2) Date General Journal Debit Credit 12/31/2020 Bonds payable 600000 premium on bonds 33,887 Gain on Redemption 65576 Cash 568,311

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