Compute Bond Proceeds, Amortizing Discount by Interest Method, and Interest Expense

Boyd Co. produces and sells aviation equipment. On the first day of its fiscal year, Boyd Co. issued $70,000,000 of five-year, 12% bonds at a market (effective) interest rate of 14%, with interest payable semiannually. Compute the following:

a. The amount of cash proceeds from the sale of the bonds. Use the tables of present values in Exhibit 8 and Exhibit 10. Round to the nearest dollar. $fill in the blank 1

b. The amount of discount to be amortized for the first semiannual interest payment period, using the interest method. Round to the nearest dollar. $fill in the blank 2

c. The amount of discount to be amortized for the second semiannual interest payment period, using the interest method. Round to the nearest dollar. $fill in the blank 3

d. The amount of the bond interest expense for the first year. Round to the nearest dollar.