Morrison Company issued $200,000 of 10-year, 8% bonds at 92 on July 1, Year 1. Interest is payable semiannually on January 1, and July 1. The company uses straight-line amortization for premium or discount on bonds payable.
Required:What amount of interest expense will be shown on the Year 1 and Year 2 income statements?What amount of interest payments will be shown on the statement of cash flows for Year 1 and Year 2?

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The Answer of Morrison Company issued $200,000 of 10-year, 8% bonds at 92 on July 1, Year 1. Interest is payable semiannually on January 1, and July 1. The company uses straight-line amortization for premium or discount on bonds payable.
Required:What amount of interest expense will be shown on the Year 1 and Year 2 income statements?What amount of interest payments will be shown on the statement of cash flows for Year 1 and Year 2?

Morrison Company Issued $200,000 of 10-Year, 8% Bonds at 92