Chapter 10, Problem 10P

1.

To determine

Complete the amortization schedule.

2.

To determine

Identify the amount of principal that Corporation O will pay to the investors at maturity.

3.

To determine

Identify the cash that was received on the day of issuance of the bonds.

4.

To determine

Identify whether there was a premium or a discount and by how much amount.

5.

To determine

Identify the amount of cash that is disbursed for interest each period.

To determine

Calculate the total amount of cash interest that will be disbursed in total over the life of the bonds.

6.

To determine

Calculate the coupon rate of interest.

7.

To determine

Calculate the annual market rate of interest.

8.

To determine

Identify interest expense that will be reported on the income statements for Year 2, and Year 3.

9.

To determine

Show the presentation of bonds that will be reported on the balance sheet at end of Year 2 and Year 3.