1. Assume the coupon rate is 4.5%. Under which case would cash paid for interest payments be the highest?
   1. If the bond is sold at par
   2. If the bond is sold at a premium
   3. If the bond is sold at a discount
   4. Cash interest payments would be the same for each scenario

2. Please complete the table below:

	Coupon Rate	Market Rate	Premium, Discount, or Par	Amount of cash recorded greater than, less than, or equal to par value
Bond A	8%	8%
Bond B	7%	10%
Bond C	9%	5%

3. What is the purpose of amortization? (+.5)
   1. To determine interest payments
   2. To bring the liability to the bonds face value at the maturity date
   3. Calculate whether the bond will be issued at a discount or premium
   4. Determine the amount of cash received at bond issuance

For questions 4 7, please use excel to build an amortization schedule and calculate your answers.

4. Jessica Day Corp. issued callable bonds with a face value of $200,000 and a coupon rate of 10%. The bond matures in 4 years and pays interest semi-annually. The market rate at time of issuance is 7%. Provide the journal entry to record the issuance of the bonds on January 1^st, 2020.

5. Record the journal entry for the interest expense on 6/30/2021?

6. What is the net book value of the bonds payable at 12/31/2022?

7. Jessica Day Corp. decides to exercise the right to retire its bonds early on 12/31/2022. It calls its bond at a call premium of 3 percent over par. Record the retirement of the bonds.