2. (10 points) Mazeltov Corporation issued $100,000 3-year, 10% stated rate bond

Question

2. (10 points) Mazeltov Corporation issued $100,000 3-year, 10% stated rate bonds on January The bonds pay interest semi-annually and were sold when the market rate was896 a. Calculate the issue price of the bonds. b. Prepare an amortization schedule for the bonds (use the table below) Payment Carrying Value,Cash Date InterestE nterest Amortization Carrying Value, Expense beginning ending 6/30/04 12/31/04 6/30/05 12/31/05 6/30/06 12/31/06 Record the interest e e entry for the 6/30/05 interest payment: Credits c. Accounts

Explanation / Answer

b

C

a Issue Price Rate 4% Nper 6 PMT 5000 PV 100000 PV $105,242.14

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