X2 issued callable bonds on January 1, 2012. The bonds pay interest annually on December 31 each year. X2's accountant has projected the following amortization schedule from issuance until maturity:
$\begin{array}{lllll}
& \text { Cash } & \text { Interest } & \text { Decrease in } & \text { Carrying } \
\text { Date } & \text { Paid } & \text { Expense } & \text { Carrying Value } & \text { Value }\1 / 1 / 10 & & & & \$ 104,212 \
12 / 31 / 11 & \$ 7,000 & \$ 6,253 & \$ 747 & 103,465 \
12 / 31 / 12 & 7,000 & 6,208 & 792 & 102,673\
12 / 31 / 13 & 7,000 & 6,160 & 840 & 101,833 \
12 / 31 / 14 & 7,000 & 6,110 & 890 & 100,943 \
12 / 31 / 15 & 7,000 & 6,057 & 943 & 100,000
\end{array}$
-X2 issued the bonds:

Question

X2 issued callable bonds on January 1, 2012. The bonds pay interest annually on December 31 each year. X2's accountant has projected the following amortization schedule from issuance until maturity:
$\begin{array}{lllll} 
& \text { Cash } & \text { Interest } & \text { Decrease in } & \text { Carrying } \
\text { Date } & \text { Paid } & \text { Expense } & \text { Carrying Value } & \text { Value }\1 / 1 / 10 & & & & \$ 104,212 \
12 / 31 / 11 & \$ 7,000 & \$ 6,253 & \$ 747 & 103,465 \
12 / 31 / 12 & 7,000 & 6,208 & 792 & 102,673\
12 / 31 / 13 & 7,000 & 6,160 & 840 & 101,833 \
12 / 31 / 14 & 7,000 & 6,110 & 890 & 100,943 \
12 / 31 / 15 & 7,000 & 6,057 & 943 & 100,000
\end{array}$
-X2 issued the bonds:

Quizplus · Accepted Answer

The carrying value of the bonds at issuance is $104,212, which is above the face value of $100,000, indicating that the bonds were issued at a premium.

X2 Issued Callable Bonds on January 1, 2012 -X2 Issued the Bonds: A)At Par

X2 Issued Callable Bonds on January 1, 2012 -X2 Issued the Bonds:
A)At Par