Preparing an Amortization Schedule and Recording the Effects of Bonds $($FSET$)$

On April $30$ Cheng, Inc., issued $$325,000$ of $6\%,15-$year bonds for $$268,801,$ yielding an effective interest rate of $8\%.$ Semiannual interest is payable on October $31$ and April $30$ each year. The firm uses the effective interest method to amortize the discount.

a$.$ Prepare an amortization schedule showing the necessary information for the first two interest periods.

$$ Note: Round answers to the nearest whole dollar.

Period Interest Expense Cash Interest Paid Discount Amortization Discount Balance Bond Payable Net

$0$ Answer

$56199$

Answer

$268801$

$1$ Answer

$10752$

Answer

$9750$

Answer

$1002$

Answer

$55197$

Answer

$269803$

$2$ Answer

$10792$

Answer

$9750$

Answer

$1042$

Answer

$54155$

Answer

$270845$

b$.$ In the financial statement effects template, report $(1)$ the bond issuance on April $30,(2)$ the bond interest payment and discount amortization at October $31,(3)$ the adjusting entry to record bond interest expense and discount amortization at December $31,$ the close of the firm$$s accounting year, and $(4)$ the bond interest payment and discount amortization at April $30$ of the following year.

$$ Note: Use negative signs with your answers, when appropriate.

$$ Note: Select $"$N$/$A$"$ as your answer if a part of the accounting equation is not affected.

$$ Note: Round answers to the nearest whole dollar.