Use this template that I attached to answer the question "prepare templates (Balance Sheet) that would show the accounti

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Use this template that I attached to answer the question
"prepare templates (Balance Sheet) that would show the accounting
for the sale of the bonds and the first two interest payments."

Use This Template That I Attached To Answer The Question Prepare Templates Balance Sheet That Would Show The Accounti 1 (73.73 KiB) Viewed 32 times

This is the example from a textbook, please use it as a
reference. THE CHART BELOW IS AN EXAMPLE NOT THE QUESTION.

Use This Template That I Attached To Answer The Question Prepare Templates Balance Sheet That Would Show The Accounti 2 (262.99 KiB) Viewed 32 times

Face Value of Bonds 1,000,000 Face or Contract Interest Rate 4% 6% Market or Effective Interest Rate Number of Years Number of Interest Payments per Year 5 2 Selling Price of Bonds $914,697.97 Time Period 0 1 2 3 4 Interest Payment Interest Expense Amortization of Discount or Premium Remaining Discount or Premium Bond Carrying Value 85,302 $914,697.97 20000 $27,440.94 $7,440.94 77,861 $922,138.91 20000 $27,664.17 $7,664.17 70,197 $929,803.08 20000 $27,894.09 $7,894.09 62,303 $937,697.17 20000 $28,130.92 $8,130.92 54,172 $945,828.09 20000 $28,374.84 $8,374.84 45,797 $954,202.93 20000 $28,626.09 $8,626.09 37,171 $962,829.02 20000 $28,884.87 $8,884.87 28,286 $971,713.89 20000 $29,151.42 $9,151.42 19,135 $980,865.30 20000 $29,425.96 $9,425.96 9,709 $990,291.26 20000 $29,708.74 $9,708.74 0 $1,000,000.00 5 6 7 8 9 10
EXHIBIT 9-3 Bonds Sold at a Premium: Effective Interest Method E Book Value of Bonds, End of Period ($100,000 + D) Year At issue... 2020 $100,000 of 8%, four-year bonds with interest payable semiannually issued on December 31, 2019, at $107,020 to yield 6% A B с D Interest Balance of Interest Paid Expense Periodic Unamortized Interest (4% of face (3% of bond Amortization Premium Period value) book value) (A - B) (D - C) $7,020 1 $4,000 $3,211 $789 6,231 2 4,000 3,187 813 5,418 3 4,000 3,163 837 4,581 4 4,000 3,137 863 5 4,000 3,112 888 2,830 6 4,000 3,085 1,915 7 4,000 3,057 943 972 8 4,000 3,028 972 0 2021. 3,718 $107,020 106,231 105,418 104,581 103,718 102,830 101,915 100,972 100,000 2022. 915 2023..... *Adjusted for cumulative rounding error of $1 The amounts for each interest payment are taken directly from the amortization schedule. The financial statement effect of the first interest payment follows. Note that the periodic interest ex- pense is less than the semiannual interest payment. Transaction: Semiannual interest payment and amortization of bond premium. Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity Contrib. Capital + Retained Earnings Revenues - Expenses Net Income -3,211 -4,000 Cash -3,211 = -789 Premium on bond payable +3,211 Bond interest expense