(Analysis of Amortization Schedule and Interest Entries) The following amortization and interest schedule reflects the issuance of 10-year bonds by Capulet Corporation on January 1, 2004, and the subsequent interest payments and charges. The company's year-end is December 31, and financial statements are prepared once yearly.

(a) Indicate whether the bonds were issued at a premium or a discount and how you can determine this fact from the schedule.

(b) Indicate whether the amortization schedule is based on the straight-line method or the effective interest method and how you can determine which method is used.

(c) Determine the stated interest rate and the effective interest rate.

(d) On the basis of the schedule above, prepare the journal entry to record the issuance of the bonds on January 1, 2004.

(e) On the basis of the schedule above, prepare the journal entry or entries to reflect the bond transactions and accruals for 2004. (Interest is paid January 1.)

(f) On the basis of the schedule above, prepare the journal entry or entries to reflect the bond transactions and accruals for 2011. Capulet Corporation does not use reversingentries.

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Year 1/1/2004 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Cash $11,000 11,000 11,000 11,000 11,000 11,000 11,000 11,000 11,000 11,000 Amortization Schedule Interest $11,322 11,361 11,404 11,452 11,507 11,567 11,635 11,712 11,797 11,894 Amount Unamortized $5,651 5,329 4,968 4,564 4,112 3,605 3,038 2,403 1,691 894 Book Value $ 94,349 94,671 95,032 95,436 95,888 96,395 96,962 97,597 98,309 99,106 100,000