Part II - Question 6: Bonds (total of 10 points) b) The following information pertains to a company's bond issue: Maturity value: $1,000,000 Maturity date: January 1, 2022 Stated interest rate: 8% Interest payments are made annually on December 31st Date of issue: January 1, 2017 The bond is dated January 1, 2017 Effective market) interest rate on date of issue: 10% Present value factors are 8% 10% PV of Sl. 2 years 0.857339 0.826446 PV of Sl. 5 years 0.680583 0.620921 PV of annuity of Si. 2 years 1.783265 1.735537 PV of annuity of SI. 5 years 3.992710 3.790787 1296 0.797194 0.567427 1.690051 3.604776 Requirements: (1) At what price were the bonds issued? (2 points) (11) Using the effective interest method, fill the blanks in the amortization schedule below showing annual interest expense, annual discount or premium amortization, and carrying value through December 31, 2019. Write down the expressions that you use to calculate the numbers in each column. 4 points) Interest Expense Cash Payment Discount or Premium Amortization Date Book Valus Jan 1, 2017 Dec 31, 2017 Dec 31, 2018 Dec 31, 2019 Expressions used: Interest expense Cash payment for interest Discount or premium amortization Book value (ending) 19