TestIIProblems: Answer the requirements for each of the following unrelated problems: Round present value factors to three (3) decimals and final answers to the nearest peso. (75%) (30 items @2.5 points each)

AArc Corporation is authorized to issue P3,000,000, 4 year bonds dated December 31, 2019 with stated interest rate of 8%. Interest on the bonds is payable annually on December 31. The company uses the effective interest method of amortization. The bonds were sold to yield (a) 10%; (b) 6%. (17.5%) ( 7 items @2.5 points each)

Required: Complete the table below.

(a)10%

(b)6%

Q1 Bond Issue Price

Q2 Interest expense(effective interest) for 2020

Q3 Discount/Premium amortization for 2020

Q4 Bond carrying value at December 31, 2020

Q5 Interest expense for 2021

Q6 Discount amortization for 2021

Q7 Bond carrying value at December 31, 2021