Amortization of Bond Premium On January 1, Bold Corporation issues $600,000 of 4-year bonds with a stated interest rate of 9 percent. Interest is payable at the end of each year. The issue price is $628,000. Assuming straightline amortization of the bond premium is used in computing interest expense:

a. What amount of interest expense will Bold report annually?

b. Prepare a bond interest and amortization table for the life of the bonds, as illustrated in Exhibit 11-4.

c. What is the book value of the bonds at the end of the second year?