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Standard Autoparts Inc. issued $110,000 of 3%, 10-year bonds at a price of 85 on January 31, 2017. The market interest rate at the date
Standard Autoparts Inc. issued $110,000 of 3%, 10-year bonds at a price of 85 on January 31, 2017. The market interest rate at the date of issuance was 6%, and the standard bonds pay interest semi-annually. 1. Prepare an effective-interest amortization table for the bonds through the first three interest payments. 2. Record Standard's issuance of the bonds on January 31, 2017, and payment of the first semi-annual interest amount and amortization of the bonds on July 31, 2017. Explanations are not required. 1. Prepare an effective-interest amortization table for the bonds through the first three interest payments. (Round your answers to the nearest whole dollar.) Standard Autoparts Amortization Table B D E Bond Discount Bond Discount Bond Semi-annual Interest Payment (1.5% of Maturity Value) Interest Expense (3% of Preceding Bond Carrying Amount) Amortization Account Balance Carrying Amount ($110,000 - D) Interest Date (B - A) (Preceding D-C) Jan 31, 2017 July 31, 2017 1650 Jan 31, 2018 1650 July 31, 2018 1650
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