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On January 1, 2002, the market interest rate is 7%. Sharp Sharpy, Inc., issues $200,000 of 8%, 20-year bonds payable at 110. The bonds pay

On January 1, 2002, the market interest rate is 7%. Sharp Sharpy, Inc., issues $200,000 of 8%, 20-year bonds payable at 110. The bonds pay interest on June 30 and December 31. Sharp Sharpy measures interest expense by the effective-interest method. Required: 1. Prepare an amortization table for the first four semiannual interest periods. 2. Record the first semiannual interest payment on June 30 and the second payment on December 31.

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