During Year 1 and Year 2, Kale Co completed the following transactions relating to its bond issue The companys fiscal year ends on December 31 Year 1 Mar 1 Issued $200,000 of 8 year, 6 percent bonds for $194,000 The semiannual cash payment for interest is due on March 1 and September 1, beginning September Year 1 Sept 1 Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest Dec 31 Recognized accrued interest expense including the amortization of the discount Year 2 Mar 1 Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest Sept 1 Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest Dec 31 Recognized accrued interest expense including the amortization of the discount Required When the bonds were issued, was the market rate of interest more or less than the stated rate of interest If the bonds had sold at face value, what amount of cash would Kale Co have received Prepare the liabilities section of the balance sheet at December 31, Year 1 and Year 2 Determine the amount of interest expense Kale would report on the income statements for Year 1 and Year 2 Determine the amount of interest Kale would pay to the bondholders in Year 1 and Year 2 Answer is not complete Complete this question by entering your answers in the tabs below repare the liabilities section of the balance sheet at December 31, Year 1 and Year 2 Answer is not complete Complete this question by entering your answers in the tabs below c Determine the amount of interest expense Kale would report on the income statements for Year 1 and Ye d Determine the amount of interest Kale would pay to the bondholders in Year 1 and Year 2

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Posted on Jul 28, 2024

During Year 1 and Year 2, Kale Co. completed the following transactions relating to its bond issue. The companys fiscal year ends on December 31.

Year 1

Mar.	1	Issued $200,000 of 8 year, 6 percent bonds for $194,000. The semiannual cash payment for interest is due on March 1 and September 1, beginning September Year 1.
Sept.	1	Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest.
Dec.	31	Recognized accrued interest expense including the amortization of the discount.

Year 2

Mar.	1	Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest.
Sept.	1	Recognized interest expense including the amortization of the discount and made the semiannual cash payment for interest.
Dec.	31	Recognized accrued interest expense including the amortization of the discount.

Required

When the bonds were issued, was the market rate of interest more or less than the stated rate of interest? If the bonds had sold at face value, what amount of cash would Kale Co. have received?
Prepare the liabilities section of the balance sheet at December 31, Year 1 and Year 2.
Determine the amount of interest expense Kale would report on the income statements for Year 1 and Year 2.
Determine the amount of interest Kale would pay to the bondholders in Year 1 and Year 2.

Answer is not complete. Complete this question by entering your answers in the tabs below. repare the liabilities section of the balance sheet at December 31, Year 1 and Year 2 . Answer is not complete. Complete this question by entering your answers in the tabs below. c. Determine the amount of interest expense Kale would report on the income statements for Year 1 and Ye d. Determine the amount of interest Kale would pay to the bondholders in Year 1 and Year 2