Required information P10-6 (Algo) Recording and Reporting Bonds Issued at a Discount LO10-4 [The following information applies to the questions displayed below] PowerTap Utilities is planning to issue bonds with a face value of $1,300,000 and a coupon rate of 7 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31 . All of the bonds were sold on January 1 of this year. PowerTap uses the effective-interest amortization method. Assume an annual market rate of interest of 8 percent. (FV of \$1: PV of \$1. FVA of \$1, and PVA of \$1) Note: Use appropriate factor(s) from the tables provided. P10-6 Part 1 Required: 1. What was the issue price on January 1 of this year? Note: Round your final answer to nearest whole dollar amount. Required information P10-6 (Algo) Recording and Reporting Bonds Issued at a Discount LO10-4 [The following information applies to the questions displayed below.] PowerTap Utilities is planning to issue bonds with a face value of $1,300,000 and a coupon rate of 7 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31 . All of the bonds were sold on January 1 of this year. PowerTap uses the effective-interest amortization method. Assume an annual market rate of interest of 8 percent. (FV of \$1, PV of \$1. EVA of \$1, and PVA of \$1) Note: Use appropriate factor(s) from the tables provided. P10-6 Part 3 3. What amount of cash should be paid to investors June 30 and December 31 of this year? Tesent Value of Annuly of $1 Required information P10-6 (Algo) Recording and Reporting Bonds Issued at a Discount LO10.4 [The following information applies to the questions displayed below] PowerTap Utilities is planning to issue bonds with a face value of $1,300,000 and a coupon rate of 7 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31 . All of the bonds were sold on January 1 of this year. PowerTap uses the effective-interest amortization method. Assume an annual market rate of interest of 8 percent. (FV of S1; PV of \$1, EVA of \$1, and PVA of \$1) Note: Use appropriate factor(s) from the tables provided. P10-6 Part 2 2. What amount of interest expense should be recorded on June 30 and December 31 of this year? Note: Round your final answers to nearest whole dollar amount. Required information P10-6 (Algo) Recording and Reporting Bonds Issued at a Discount LO10-4 [The following information applies to the questions displayed below.] PowerTap Utilities is planning to issue bonds with a face value of $1,300,000 and a coupon rate of 7 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31 . All of the bonds were sold on January 1 of this year. PowerTap uses the effective-interest amortization method. Assume an annual market rate of interest of 8 percent. (EV of \$1. PV of \$1. EVA of \$1, and PVA of \$1) Note: Use appropriate factor(s) from the tables provided. P10-6 Part 4 4. What is the book value of the bonds on June 30 and December 31 of this year? Note: Round your final answers to nearest whole dollar amount. Future Value of Annuity of \$1 \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|} \hline Derieds & 1.05 & 2.07 & 3.08 & 2.70x & \multicolumn{2}{|r|}{6.015} & 6.255 & 1.0x & & 7.08 \\ \hline 1 & 100000 & 100000 & 100000 & 100000 & \multicolumn{2}{|r|}{100000} & 1.00000 & 1.00000 & 1.00000 & 100000 \\ \hline 2 & 2.01000 & 202000 & 203000 & 201750 & \multicolumn{2}{|r|}{204000} & 200250 & 205000 & 206000 & 207000 \\ \hline 3 & 309010 & 206040 & 309090 & 211391 & \multicolumn{2}{|r|}{312160} & 212931 & 21580 & 318360 & 321450 \\ \hline 4 & 4,06040 & 4.12161 & 418963 & \multirow{2}{*}{4.230645.38933} & \multicolumn{2}{|r|}{424646} & 42930 & 4.31013 & 4.37462 & 4.4394 \\ \hline 5 & 5.10101 & 520404 & 5.30914 & & \multicolumn{2}{|r|}{5.41632} & 5.44345 & 5.57563 & 5.62700 & 575014 \\ \hline 6 & 6.15202 & 630012 & 645541 & (5)14) & & 663298 & 6.57410 & 6.00191 & 6.97532 & 7.15329 \\ \hline 7 & 721354 & 7.43421 & 766245 & 78051 & & 15ste & 7SSE48 & 8.14201 & 1.393e4 & 365402 \\ \hline a & 22856? & & 3.09234 & 21385 & & 521423 & 9271 & 954911 & 9.89747 & 105s90 \\ \hline 9 & 936853 & 975463 & 10.15911 & 1047503 & & 105s250 & 1069182 & 1102656 & 11.49132 & 1197799 \\ \hline 10 & 10.45221 & 1094972 & 11.46388 & 11.85784 & & 200611 & 12.14522 & 125mb9 & 12+8079 & 1211645 \\ \hline Future Va & ve of Annuly of $1 & & & & & & & & & \\ \hline Perieds & 1.05 & 2.08 & 3.0s & 3.755 & & 4.05 & 4.25s & 3.0x & 5.0s & 7.0s \\ \hlinen & 1156683 & 12.16872 & 1280780 & 133125 & & 348635 & 1366244 & 14.20679 & 1497164 & 15.75960 \\ \hline 12 & 1260250 & 13.41209 & 14.19203 & 14:1212 & & 502581 & 1526309 & 1591713 & 1685994 & \\ \hline B & 13.80933 & 14 seon3 & 15.61779 & 16.3675 & & 662654 & 1689092 & 17720 & 1881214 & 20.14064 \\ \hline 4 & 1494742 & 15.97394 & 1708632 & 1793135 & & 2.29191 & 1860879 & 19.59363 & 21.01507 & s5049 \\ \hline 15 & 1609690 & 17.29342 & 18.59891 & 196556 & & 002359 & 2039966 & 2157 es6 & 23.27597 & 25,12002 \\ \hlinex & 1125725 & 18.69929 & 20.15688 & 213927 & & 182453 & 2226665 & 2365749 & 2567253 & \\ \hline & 18.43044 & 2001207 & 21.76159 & 23.1949 & & 369751 & 24.21298 & 2584037 & 28.21288 & 30.8022 \\ \hline t4 & 1961475 & 21.41231 & 23.41444 & 250647 & & 560541 & 2624201 & 28.13238 & 30.90565 & 3399903 \\ \hline 19 & 2081090 & 22.84056 & 25.11683 & 27.0047 & & 7.67123 & 2635732 & 30,53900 & 33.75999 & 37.375% \\ \hline 20 & 2201900 & 24.29137 & 2687037 & 290173 & & 977808 & 3056750 & 3306595 & 36.78559 & 40.99549 \\ \hline 25 & 28.24320 & 32.03000 & 36.45926 & 40.2711 & & 1.54599 & 4301648 & 47.72710 & 5106451 & 6324904 \\ \hline 30 & 2478499 & 4058004 & 4757542 & 53.7992 & & 608494 & 58.48553 & 66.43885 & 7905819 & 94.45079 \\ \hline Future Va & ve of Annuity of $ & & & & & & & & & \\ \hline Pariad & 0.0x & 0.0s & 10.0x & 11.0% & 12.0x & 13.0N & 14.6x & 15.0% & 20.0x & 25.0% \\ \hline 1 & 100000 & 100000 & 100000 & 1.00000 & 1.00000 & 100000 & 1.00000 & 100000 & 100000 & 100000 \\ \hline 2 & 200000 & 209000 & 210000 & 2.11000 & 212000 & 213000 & 214000 & 215000 & 220000 & 2.25000 \\ \hline 3 & 324640 & 327810 & 331000 & 3.34210 & 3.37440 & 3,40690 & 3.43960 & 3.47250 & 364000 & 3.81250 \\ \hline 4 & 450611 & 457313 & 464100 & 4.70973 & 4.77933 & 484980 & 492114 & 499337 & 5.36800 & 576563 \\ \hline 5 & 586660 & 55847 & 6.10510 & 6.22780 & 6.35285 & 6.43027 & 651010 & 6.74238 & 7,44160 & 1.20703 \\ \hline 6 & 733593 & 752333 & 771561 & 791286 & 8.11519 & 83221 & 853552 & 8.75374 & 992992 & 11.25999 \\ \hline 7 & 192280 & 92000 & & 9.78327 & 10.08901 & 10.40466 & 1073049 & 11.06680 & 1291590 & 15.07349 \\ \hline 8 & 1063663 & 1102847 & 11.43509 & 11.85943 & 1229969 & 1275726 & 11232%6 & 1372682 & 16.49908 & 1984186 \\ \hline 9 & 1248755 & 1202104 & 1357948 & 14.16397 & 14.77566 & 15.41571 & 1608535 & 16.78584 & 2079290 & 2580232 \\ \hline 10 & 14.48656 & 1519293 & 1593742 & 16.72201 & 1754874 & 11.41975 & 1933730 & 20.30372 & 25.9586s & 33.25790 \\ \hline Future Va & We of Annuity o & & & & & & & & & \\ \hline Nerieds & e.0 & 0.08 & 10.0s & 11.0w & 12.0% & 12.0s & 14.0N & 15.0x & 20.05 & 25.05 \\ \hlinen & 16.64549 & 1756029 & 1853117 & 1956143 & 20.65458 & 2181432 & 2304452 & 2434928 & 32.15042 & 4256611 \\ \hlinen & 189m13 & 2014072 & 2138428 & 2271319 & 24.13313 & 25.65018 & 2727075 & 29.00167 & 3958050 & 542076 \\ \hline & 21.49590 & 2295338 & 24.52231 & 26.21164 & 28.02911 & 29.98470 & 3206365 & 3435192 & 48.4860 & 6875958 \\ \hline s & 2421492 & 2601919 & 2797498 & 30.09492 & 3239260 & 3488271 & 37.58107 & 4050471 & 59.195m2 & 8694947 \\ \hline 15 & 27.15211 & 2936092 & 3137248 & 34.40536 & 37.27971 & 42.41746 & 43:4241 & 47.58041 & 7203511 & 10968584 \\ \hline 16 & 3032428 & 3300340 & 35.4473 & 3216%5 & 42.75328 & 46.57173 & sassoss & 55.71747 & 97.44213 & 13e. 10855 \\ \hline 7 & 3175023 & 3697370 & 4054470 & 4450084 & 4888367 & 5373906 & 59.11760 & 6507509 & 10593055 & 17ngses \\ \hline 18 & 31.45024 & 4130134 & 4559917 & 50.39594 & 5574971 & 61.72514 & 6.39407 & 75.83636 & 12211667 & 21404560 \\ \hline 19 & 4144626 & 4601846 & 51.15909 & $593949 & 6143968 & 7074941 & 7896923 & 8821181 & 15474000 & 27355576 \\ \hline 20 & 45.7619 & 51.16012 & 5727500 & 6420283 & 7205244 & 8094583 & 91.02493 & 10244358 & 1366$500 & 34296470 \\ \hline 25 & 73.10594 & 34700% & 9834706 & 11441331 & 13133387 & 155.61956 & 181 mose & 21279302 & 47.9a108 & 10547911t \\ \hline 30 & 11328321 & 13630754 & 164.49402 & & 24139268 & 293.19922 & 356.7Lses & 434.74515 & 118188157 & 3227,17427 \\ \hline \end{tabular} Present Value of \$1 \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|} \hline Perieds & e.0s & 5.0% & 10.0x & 11.0s & 120s & 13.0% & 14.0% & 15.0% & 20.046 & 25.0N \\ \hline 1 & 0.92593 & 0.91743 & 0.90909 & 0.90090 & 0.89286 & 0.88496 & 0.87719 & 0.86957 & 0.83333 & 080000 \\ \hline 2 & 0.85734 & 0.84168 & 0.82645 & 081162 & 0.79719 & 0.78315 & 0.76947 & 0.75614 & 0.69444 & 0.64000 \\ \hline 3 & 0.79383 & 0.77218 & 0.75131 & 0.73119 & 0.71178 & 0.69305 & 0.67497 & 0.65752 & 0.57870 & 0.51200 \\ \hline 4 & 0.73503 & 0.70043 & 068301 & 0.65873 & 0.63552 & 0.61332 & 0.59203 & 0.57175 & 0.48225 & 0.40960 \\ \hline 5 & 0.68558 & 0.69993 & 0.62092 & 0.59345 & 0.56743 & 0.54276 & 0.51937 & 0.49718 & 0.40188 & 0.32768 \\ \hline 6 & 0.63017 & 0.59627 & 0.56447 & 0.53454 & 0.50663 & 0.48032 & 0.45559 & 0.43233 & 033490 & 026214 \\ \hline 7 & 0.58349 & 0.54703 & 0.51316 & 0.48166 & 0.45235 & 0.42506 & 0.39964 & 0.37594 & 0.27908 & 0.20972 \\ \hlineB & 0.54027 & 050187 & 0.46651 & 0.43393 & 0.40388 & 0.37616 & 0.35056 & 0.32690 & 0.23257 & 0.16m7 \\ \hline 9 & 050025 & 0.46043 & 0.42410 & 0,39092 & 036061 & 0.33288 & 0.30751 & 0.28426 & 0.19381 & 0.13422 \\ \hline 10 & 0.46319 & 0.42241 & 0.38554 & 0.35218 & 032197 & 0.29459 & 0.26974 & 0.24718 & 0.16151 & 0.10737 \\ \hline \multicolumn{11}{|c|}{ Present Value of $1} \\ \hline Periads & 0.0s & 0.0% & 10.0s & 11.0% & 12.0% & 12.0% & 14.08 & 15.0% & 20.0% & 25.0 \\ \hline 11 & 0.42888 & 0.38753 & 0.35049 & 0.31728 & 0.23748 & 0.26070 & 0.23652 & 021494 & 0.13459 & 008590 \\ \hline 12 & 0.39711 & 0.35553 & 0.31863 & 0.28584 & 0.25668 & 0.23071 & 020756 & 0.18691 & 0.11216 & 0.06872 \\ \hline 13 & 0.35770 & 0.32618 & 0.28966 & 0.25751 & 0.22917 & 020416 & 0.18207 & 0.16253 & 0.09346 & 0.05498 \\ \hline 14 & 034046 & 0.29925 & 0.26333 & 0.23199 & 0.20462 & 0.18068 & 0.15971 & 0.14133 & 0.07789 & 0.04398 \\ \hline 15 & 0.31524 & 0.27454 & 023939 & 0.20900 & 0.18270 & 0.15939 & 0.14010 & 0.12289 & 006491 & 0.03518 \\ \hline 16 & 0.29189 & 0.75187 & 0.21763 & 0.18829 & 0.16312 & 0.14150 & 0.12789 & 0.10686 & 0.05409 & 002815 \\ \hline 17 & 0.27027 & 0.23107 & 0.19784 & 0.16963 & 0.14564 & 0.12522 & 0.10780 & 0.09293 & 0.04507 & 0.02252 \\ \hline 18 & 0.25025 & 0.21199 & 0.17936 & 0.15282 & 0.13004 & 0.11081 & 0.09456 & oososi: & 0.03756 & 001801 \\ \hline 19 & 0.23171 & 0.19449 & 0.16351 & 0.13768 & 0.11611 & 0.09806 & 0.08295 & 0.07027 & 0.03130 & 0.01441 \\ \hline 20 & 021455 & 0.17843 & 0.14e64 & 0.12403 & 0.10367 & 0.08578 & 0.07276 & 0.05110 & 0.02608 & 001153 \\ \hline 25 & 0.14602 & 0.11597 & 0.09230 & 0.07361 & 005862 & 0.04710 & 0,03779 & 0.03038 & 001048 & 0.00378 \\ \hline 30 & 0.09938 & 0.07537 & 0.05731 & 0.04358 & 0.03338 & 0.02557 & 0.01963 & 0.01510 & 0.00421 & 0,00124 \\ \hline \end{tabular}