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On January 1, 2016, Bradley Recreational Products issued $160,000, 8%, four-year bonds. Interest is paid semiannually on June 30 and December 31. The bonds were

On January 1, 2016, Bradley Recreational Products issued $160,000, 8%, four-year bonds. Interest is paid semiannually on June 30 and December 31. The bonds were issued at $149,659 to yield an annual return of 10%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 ) (Use appropriate factor(s) from the tables provided.)

Required: 1. Prepare an amortization schedule that determines interest at the effective interest rate.

2. Prepare an amortization schedule by the straight-line method.

3. Prepare the journal entries to record interest expense on June 30, 2018, by each of the two approaches. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

4. Assuming the market rate is still 10%, what price would a second investor pay the first investor on June 30, 2018, for $16,000 of the bonds?

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