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On January 1, 2016, Gylland Company purchased bonds with a maturity value of $5,000 for $4,664. These bonds have a 14% per year coupon
On January 1, 2016, Gylland Company purchased bonds with a maturity value of $5,000 for $4,664. These bonds have a 14% per year coupon rate payable semi-annually on June 30 and December 31. The bond matures on December 31, 2020. On January 1, 2016, the market yield for bonds of equivalent risk and maturity was 16% per year. Required Using the straight-line alternative permitted under ASPE, prepare an amortization schedule that shows the amortized cost of this bond at the end of each of the five years and the amount of interest income for each of those five years. Complete the table below. (Round amounts to the nearest cent.) Beginning amortized cost Interest income Year 1 - Jun 30 Year 1 - Dec 31 Year 2 - Jun 30 Year 2 - Dec 31 Year 3 - Jun 30 Year 3 - Dec 31 Year 4 - Jun 30 Year 4 - Dec 31 Year 5 - Jun 30 Year 5 - Dec 31 Coupon payment Ending = amortized cost
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