Karen Austin Inc. has issued three types of debt on January 1, 2020, the start of the company’s fiscal year.

a. $10 million, 10-year, 15% unsecured bonds, interest payable quarterly. Bonds were priced to yield 12%.

b. $25 million par of 10-year, zero-coupon bonds at a price to yield 12% per year.

c. $20 million, 10-year, 10% mortgage bonds, interest payable annually to yield 12%.

Instructions

Prepare a schedule that identifies the following items for each bond: 

(1) Maturity value, 

(2) Number of interest periods over life of bond, 

(3) Stated rate per each interest period, 

(4) Effective-interest rate per each interest period, 

(5) Payment amount per period, 

(6) Present value of bonds at date of issue.