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Cornerstone Exercise 9-31 (Algorithmic)
Bonds Issued at a Discount (Effective Interest)
Sicily Corporation issued $450,000 in 6% bonds (payable on December 31, 2029) on January 1, 2020, for $432,000. Interest is paid on June 30 and December
31. The market rate of interest is 7%.
Required:
Prepare the amortization table through December 31, 2021, using the effective interest rate method. If an amount box does not require an entry, leave it blank
and if the answer is zero, enter "0". If required, round your answers to the nearest whole dollar.
Sicily Corporation
Amortization Table
Period
At issue $
0
0
Cash Payment (Credit) Interest Expense (Debit) Discount on Bonds Payable (Credit) Discount on Bonds Payable Balance Carrying Value
$
0
18,000?
6/30/20
13,500
15,120
1,620
12/31/20
13,500
15,177
1,677
6/30/21
13,500
15,235
1.735
12/31/21
13,500
15,296
1,796
432,000
433,620
435,297
437,032
438,828
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12:19 PM
7/11/2018