Problem 9-5A Understand a bond amortization schedule (LO9-6) [The following information applies to the questions displayed below.] On January 1, 2018, Vacation Destinations issues $20 million of bonds that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below: (1) (2) (3) (4) (5)

Date Cash Paid for Interest Interest Expense Increase in Carrying Value Carrying Value

1/1/2018 $18,578,760

6/30/2018 $600,000 $650,257 $50,257 18,629,017

12/31/2018 600,000 652,016 52,016 18,681,033

Required:

1. Were the bonds issued at face amount, a discount, or a premium?

Face amount?

Discount?

Premium?

2. What is the original issue price of the bonds? (Enter your answer in dollars, not millions. (i.e., $5.5 million should be entered as 5,500,000).)

3. What is the face amount of the bonds? (Enter your answer in dollars, not millions. (i.e., $5.5 million should be entered as 5,500,000).)

4. What is the stated annual interest rate?

5. What is the market annual interest rate? 6. What is the total cash paid for interest assuming the bonds mature in 10 years? (Enter your answer in dollars, not millions. (i.e., $5.5 million should be entered as 5,500,000).)