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On 1 January 20X8, Khalil Ltd. purchased $2,500,000 of six-year, Harvest Ltd. 9.0% bonds. The bonds pay semi-annual interest each 30 June and 31

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On 1 January 20X8, Khalil Ltd. purchased $2,500,000 of six-year, Harvest Ltd. 9.0% bonds. The bonds pay semi-annual interest each 30 June and 31 December. The market interest rate was 10% on the date of purchase. Khalil is a private company that complies with ASPE and uses straight-line amortization. (PV of $1, PVA of $1, and PVAD of $1.) (Use appropriate factor(s) from the tables provided.) Required: 1. Calculate the price paid by Khalil Ltd. (Round your time value factors to five decimal places. Do not round your intermediate calculations and round the final answer to the nearest whole dollar amount.) Price paid 2. Construct a table that shows interest revenue reported by Khalil and the carrying value of the investment for four interest periods. Use the straight-line method. (Do not round your intermediate calculations. Round your answers to the nearest whole dollar amount.) Period Cash Payment Interest Revenue Amortization Bond Carrying Value 0 1 2 3 4

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