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On January 1 of this year, Houston Company issued a bond with a face value of $16,500 and a coupon rate of 6 percent. The
On January 1 of this year, Houston Company issued a bond with a face value of $16,500 and a coupon rate of 6 percent. The bond matures in 3 years and pays interest every December 31. When the bond was issued, the annual market rate of interest was 5 percent Houston uses the effective-interest amortization method. (FV of $1. PV of $1. FVA of $1. and PVA of 51) (Use the appropriate factoris: from the tables provided. Round your final answers to whole dollars.) Required: 1. Complete a bond amortization schedule for all three years of the bond's life (Enter all values as positive values.) Interest Expenne Amortization Book Value of Bond Interest Jan. 01. Year 1 Dec 31 Years Dec. 31. Year 2 Der 31, Year 2. What amounts will be reported on the income statement and balance sheet at the end of Year 1 and Year 2? Year December 31 Interest expense Bond liability
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