On January 1, 2015, Brewers Corporation issued $1,000,000 of 6%, 5-year bonds at 99, with interest paid annually. Using the straight-line amortization method, what is the carrying value of the bonds on January 1, 2015? (Round your final answer to the nearest dollar.)

Question

Quizplus · Accepted Answer

The bonds were issued at 99, meaning they were issued at 99% of the face value. Therefore, the carrying value on January 1, 2015, is $1,000,000 * 0.99 = $990,000.

On January 1, 2015, Brewers Corporation Issued $1,000,000 of 6