Using the tables for bond discounts and premiums under the effective interest rate method answer the following (25 points)
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- What is the initial carrying value for the bond sold at premium? 103,769
- What is the interest expense for this bond on the fifth payment? 5,637
- What is the premium amortization for period six? 383
- What is the interest expense for period six for the bond sold at discount? 6,365
- What is the carrying value for this bond at the end of period ten? 100,000
Make the entries to record the bond issues sold at (1) discount and (2) at premium. (5 points)
Date Description Debit Credit
Make the entries to show the repayment of the bond principal at maturity at (1) discount and (2) at premium. (5 points)
Date Description Debit Credit
