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Exercise 10-9 Straight-Line: Amortization of bond premium LO P3 Quatro Co. issues bonds dated January 1, 2019, with a par value of $750,000. The bonds

Exercise 10-9 Straight-Line: Amortization of bond premium LO P3

Quatro Co. issues bonds dated January 1, 2019, with a par value of $750,000. The bonds annual contract rate is 9%, 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 8%, and the bonds are sold for $769,646.

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 a straight-line amortization table for these bonds.image text in transcribed

image text in transcribed

How much total bond interest expense will be recognized over the life of these bonds? Total Bond Interest Expense Over Life of Bonds: Amount repaid: payments of Par value at maturity Total repaid 0 Less amount borrowed Total bond interest expense $ 0 Semiannual Interest Period-End - Unamortized Premium Carrying Value 01/01/2019 06/30/2019 12/31/2019 06/30/2020 12/31/2020 06/30/2021 0 12/31/2021

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