18) Kash nâ Karry issues $50 million of bonds on January 1, 2018that pay interest semiannually on June 30 and December 31. Portionsof the bond amortization schedule appear below: Date Cash PaidInterest Expense Decrease in Carrying Value Carrying Value 1/1/2018$55,338,768 6/30/2018 2,000,000 1,936,857 63,143 55,275,62512/31/2018 2,000,000 1,934,647 65,353 55,210,272.
1. Were the bonds issued at face amount, a discount, or apremium?
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? (Hint: Be sure toprovide the annual rate rather than the six month rate.)
5. What is the market annual interest rate? (Hint: Be sure toprovide the annual rate rather than the six month rate.)
6. What is the total cash paid for interest assuming the bondsmature in 20 years?
18) Kash nâ Karry issues $50 million of bonds on January 1, 2018that pay interest semiannually on June 30 and December 31. Portionsof the bond amortization schedule appear below: Date Cash PaidInterest Expense Decrease in Carrying Value Carrying Value 1/1/2018$55,338,768 6/30/2018 2,000,000 1,936,857 63,143 55,275,62512/31/2018 2,000,000 1,934,647 65,353 55,210,272.
1. Were the bonds issued at face amount, a discount, or apremium?
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? (Hint: Be sure toprovide the annual rate rather than the six month rate.)
5. What is the market annual interest rate? (Hint: Be sure toprovide the annual rate rather than the six month rate.)
6. What is the total cash paid for interest assuming the bondsmature in 20 years?
On January 1, a company issued 5%, 15-year bonds with a face amount of $80 million for $59,249,660 to yield 8%. Interest is paid semiannually. What was the interest expense at the effective interest rate on the December 31 annual income statement? (Enter your answers in whole dollars. Round your intermediate calculations to the nearest dollar amount.)
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On January 1, a company issued 5%, 15-year bonds with a face amount of $80 million for $59,249,660 to yield 8%. Interest is paid semiannually. What was the interest expense at the effective interest rate on the December 31 annual income statement? (Enter your answers in whole dollars. Round your intermediate calculations to the nearest dollar amount.)
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