Exercise 9-16A Record the early retirement of bonds issued at a discount (LO9-6)

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On January 1, 2021, Splash City issues $420,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 8% and the bonds issued at $391,460.

. Using an amortization schedule, show that the bonds have a carrying value of $395,530 on December 31, 2022. (Round Interest expense to nearest whole dollar.)

Cash Paid. Interest expense increase in carrying value. carrying value

01/01/21

06/30/21

12/31/21

06/30/22

12/31/22