Interest Payments and Interest Expense for Bonds (Straight Line)

On December 31, 2018, Perlman Corporation issued bonds with a total face amount of \(\$ 1,000,000\) and a stated rate of \(7 \%\).

\section*{Required:}

1. Calculate the interest expense for 2019 if the bonds were sold at face value.

2. Calculate the interest expense for 2019 if the bonds were sold at a premium and the straightline premium amortization for 2019 is \(\$ 8,000\).

3. Calculate the interest expense for 2019 if the bonds were sold at a discount and the straightline discount amortization for 2019 is \(\$ 6,000\).

\section*{OBJECTIVE (4) Exercise