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On January 1, 2021, Bradley Recreational Products issued $200,000, 11%, four-year bonds. Interest is paid semiannually on June 30 and December 31. The bonds

 

On January 1, 2021, Bradley Recreational Products issued $200,000, 11%, four-year bonds. Interest is paid semiannually on June 30 and December 31. The bonds were issued at $193,790 to yield an annual return of 12%. ( EV of $1. PV of $1. FVA of $1. PVA of $1. EVAD 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, 2023, by each of the two approaches. 5. Assuming the market rate is still 12%, what price would a second investor pay the first investor on June 30, 2023, for $24,000 of the bonds?

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