General Instructions 1. The following worksheet may be used to complete the problem. You may need to refer to your textbook for additional information Problem 1 Norris Company issued five-year, 8% bonds with a face value of $10,000,000 on January 1, 2019. Interest is paid annually on December 31. Assume that the market rate of interest of January 1, 2019, is 9% Face Value: 10,000,000 $800,000 Required 1. Calculate the proceeds from the sale of the bonds. 1. Prepare a five-year table to amortize the discount using the effective interest method. Discount Amortization Effective Interest Method of Amortization Col. 2 Col. 4 Col. 1 Cash Interest Expense Col. 3 Discount Amortized Col. 2 - Col. 1 Interest 8% Carrying Value Date 9% 01/01/19 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 Bond TVM Cashflow Costco Answer Sheet +