Question

On January 1, 2021, Splash City issues $300,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year.

Assuming the market interest rate on the issue date is 8%, the bonds will issue at $279,615.

Required:     
1. Complete the first three rows of an amortization table.

Date	Cash Paid	Interest Expense	Change in Carrying Value	Carrying Value
1/1/21
6/30/21
12/31/21

Answer 1

Date	Cash Paid	Interest Expense	Change in Carrying Value	Carrying Value
1/1/21				$       279,615
6/30/21	$           10,500	$       11,185	$                   685	$       280,300
12/31/21	$           10,500	$       11,212	$                   712	$       281,012