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Exercise 10-22A (Algo) Effective interest amortization for a bond premium LO 10-7 On January 1, Year 1, Hart Company Issued bonds with a face value
Exercise 10-22A (Algo) Effective interest amortization for a bond premium LO 10-7 On January 1, Year 1, Hart Company Issued bonds with a face value of $117,000, a stated rate of Interest of 10 percent, and a five-year term to maturity. Interest is payable In cash on December 31 of each year. The effectlve rate of Interest was 9 percent at the time the bonds were Issued. The bonds sold for $121,551. Hart used the effectlve Interest rate method to amortize the bond premium. Note: Round your Intermedlate calculations and final answers to the nearest whole number. Required: a. Prepare an amortization table. b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the Interest expense that would appear on the Year 4 Income statement? d. What is the amount of cash outflow for Interest that would appear in the operating actlvitles section of the Year 4 statement of cash flows
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