Metro Company purchased $100,000, 10%, 5-year bonds on January 1, 20x1 when the market yield was 8.75%. Interest is payableon June 30 and January 1. The market value on December 31, 20x1 was $107,500 and all bonds were sold for $110,000 on January 1, 20x2 before the scheduled payment was made.

Required:

1. Using the Excel, compute the purchase price of the bonds on January 1, 20x1.

2. Using the Excel, prepare the amortization schedule for 5 years.