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ACCT 3753---Excel Problem---Spring 2020 On January 1, 2020, Parker Company sold in exchange for cash, $25 million of bonds payable to investors. The bonds mature on December 31, 2049, have a stated interest rate of 8%, and pay interest annually on December 31 of each year. The market interest rate was 6% on the date that Parker sold the bonds and is expected to fluctuate between 5% and 9% over the 30-year life of the bonds. As required by GAAP, Parker uses the effective interest method of amortizing any bond discount or premium. Instructions (Answer all 7 Parts Below) 1. Use Excel (and only Excel) to prepare a table for Parker Company that shows the following for each of the 30 years in the life of the bonds: Interest Expense, Cash Paid as Interest, Discount or Premium Amortization, Remaining Unamortized Discount or Premium, and Carrying Amount of the Bonds. (Note: You must use only Excel to prepare and present all parts of this table. Do not use a hand-held calculator, and do not use the compound interest tables to solve any part of this problem.) 2. Record the journal entry for Parker Company on January 1, 2020 for the issuance of the bonds. Link the numbers in the journal entry to the table you prepared in part one. 3. Record the journal entry for Parker Company that applies to interest on December 31, 2027. Link the numbers in the journal entry to the table you prepared in part one. ACCT 3753---Excel Problem---Spring 2020 On January 1, 2020, Parker Company sold in exchange for cash, $25 million of bonds payable to investors. The bonds mature on December 31, 2049, have a stated interest rate of 8%, and pay interest annually on December 31 of each year. The market interest rate was 6% on the date that Parker sold the bonds and is expected to fluctuate between 5% and 9% over the 30-year life of the bonds. As required by GAAP, Parker uses the effective interest method of amortizing any bond discount or premium. Instructions (Answer all 7 Parts Below) 1. Use Excel (and only Excel) to prepare a table for Parker Company that shows the following for each of the 30 years in the life of the bonds: Interest Expense, Cash Paid as Interest, Discount or Premium Amortization, Remaining Unamortized Discount or Premium, and Carrying Amount of the Bonds. (Note: You must use only Excel to prepare and present all parts of this table. Do not use a hand-held calculator, and do not use the compound interest tables to solve any part of this problem.) 2. Record the journal entry for Parker Company on January 1, 2020 for the issuance of the bonds. Link the numbers in the journal entry to the table you prepared in part one. 3. Record the journal entry for Parker Company that applies to interest on December 31, 2027. Link the numbers in the journal entry to the table you prepared in part one
