1. Company A issues a $20,000,000 bond on January 1, 2020with a coupon rate of 9%. The present value of the bond is $20,811,010 and the market rate of interest was 8%. The bond has a 5-year life and will make semiannual interest payments and will use the straight line amortization method.

1. Is the bond issued at a face value, a discount, or premium?
2. What is the amount of the semi-annual interest payments?
3. What is the amount that will be recorded to interest expense each time an interest payment is made?
4. What is the carrying value of the bond on December 31, 2021?

2.Company B issues a $40,000,000 bond on January 1, 2020with a coupon rate of 7%. The present value of the bond is $37,282,062 and the market rate of interest was 8%. The bond has a 10-year life and will make semiannual interest payments and will use the straight line amortization method.

1. Is the bond issued at a face value, a discount, or premium?
2. What is the amount of the semi-annual interest payments?
3. What is the amount that will be recorded to interest expense each time an interest payment is made?
4. What is the carrying value of the bond on December 31, 2021?

3. Identify the 2 errors in the following Retained Earnings statement. Make sure to clearly explain your errors so I understand your explanation.

Company M Retained Earnings Rollforward For the Month Ended 1/31/2020 Beginning Retained Earnings 30,000 Plus Net Income 40,000 Plus Cash 10,000 Plus Dividends 5.000 Net Change 55,000 Ending Retained Earnings 85.000