Temptation Vacations issues $60 million in bonds on January 1, 2015, that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below:

Required:
1. Were the bonds issued at face amount, a discount, or a premium?
2. What is the original issue price of the bonds?
3. What is the face amount of the bonds?
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 20years?

Transcribed Image Text:

Cash Paid for Interest Interest Expense Decrease in Carrying Value Carrying Value Date 1/1/2015 6/30/2015 12/31/2015 $66,934,432 $66,842,465 66,747,739 $2,100,000 2,100,000 $2,008,033 2,005,274 91,967 94,726