Interest Payments and Interest Expense for Bonds (Straight Line) On January 1, Perry Manufacturing issued bonds with a total face amount of $861,000 and a stated rate of 7%. Interest is payable annually on December 31. Required: 1. Calculate the interest expense for the first year if the bonds were sold at par. $fill in the blank 1 2. Calculate the interest expense for the first year if the bonds were sold at a premium and the straightline premium amortization is $8,000. $fill in the blank 2 3. Calculate the interest expense for the first year if the bonds were sold at a discount and the straightline discount amortization is $6,000. $fill in the blank 3
Interest Payments and Interest Expense for Bonds (Straight Line) On January 1, Perry Manufacturing issued bonds with a total face amount of $861,000 and a stated rate of 7%. Interest is payable annually on December 31. Required: 1. Calculate the interest expense for the first year if the bonds were sold at par. $fill in the blank 1 2. Calculate the interest expense for the first year if the bonds were sold at a premium and the straightline premium amortization is $8,000. $fill in the blank 2 3. Calculate the interest expense for the first year if the bonds were sold at a discount and the straightline discount amortization is $6,000. $fill in the blank 3
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Interest Payments and Interest Expense for Bonds (Straight Line)
On January 1, Perry Manufacturing issued bonds with a total face amount of $861,000 and a stated rate of 7%. Interest is payable annually on December 31.
Required:
1. Calculate the interest expense for the first year if the bonds were sold at par.
$fill in the blank 1
2. Calculate the interest expense for the first year if the bonds were sold at a premium and the straightline premium amortization is $8,000.
$fill in the blank 2
3. Calculate the interest expense for the first year if the bonds were sold at a discount and the straightline discount amortization is $6,000.
$fill in the blank 3
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