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Exercise 10-20B (Static) Effective Interest: Amortization of bond premium LO P5 Quatro Company issues bonds dated January 1, 2021, with a par value of
Exercise 10-20B (Static) Effective Interest: Amortization of bond premium LO P5 Quatro Company issues bonds dated January 1, 2021, with a par value of $400,000. The bonds' annual contract rate is 13%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of Issuance is 12%, and the bonds are sold for $409,850. 1. What is the amount of the premium on these bonds at issuance? 2. How much total bond interest expense will be recognized over the life of these bonds? 3. Prepare an effective interest amortization table for these bonds. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare an effective interest amortization table for these bonds. Note: Round all amounts to the nearest whole dollar. Semiannual Interest Period-End Cash Interest Bond Interest Paid Expense Premium Amortization Unamortized Premium Carrying Value 01/01/2021 $ 9,850 $ 409,850 06/30/2021 $ 26,000 $ 24,591 S 1,409 8,441 408,441 12/31/2021 26,000 24,506 1,494 6,947 406,947 06/30/2022 26,000 24,417 1,583 5,364 405,364 12/31/2022 26,000 24,322 1,678 3,686 403,686 06/30/2023 26.000 24.221 1779 1.9081 401 907 www
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