On January 1,2018,a company sells a 3-year bond with a face value of $50,000 and a stated interest rate of 7%.Because the market interest rate is 5%,the company receives $52,723 for the bond.The company uses the effective interest method of amortization.Fill in Table
A.Fill in Table B assuming the market interest rate is 9%,and the company received only $47,469 for the bond and the company uses the effective interest method.
$$\begin{array}{l}
\text { Table A }\
\begin{array} { | l | l | l | l | l | l | l | }
\hline \begin{array} { c }
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l }
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Amortization } \
\text { of premium }
\end{array} & \begin{array} { c }
\text { Expense }
\end{array} & \begin{array} { c }
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Premium on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Bonds } \
\text { Payable, } \
\text { Including } \
\text { Premiun }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$
$$\begin{array}{l}
\text { Table B }\
\begin{array} { | c | c | c | c | c | c | c | }
\hline \begin{array} { c }
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l }
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Amortization } \
\text { of Discount }
\end{array} & \begin{array} { c }
\text { Interest } \
\text { Expense }
\end{array} & \begin{array} { c }
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Discount on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c }
\text { Bonds } \
\text { Payable, net of } \
\text { discount }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$

Question

On January 1,2018,a company sells a 3-year bond with a face value of $50,000 and a stated interest rate of 7%.Because the market interest rate is 5%,the company receives $52,723 for the bond.The company uses the effective interest method of amortization.Fill in Table
A.Fill in Table B assuming the market interest rate is 9%,and the company received only $47,469 for the bond and the company uses the effective interest method.
$$\begin{array}{l}
\text { Table A }\
\begin{array} { | l | l | l | l | l | l | l | } 
\hline \begin{array} { c } 
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l } 
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Amortization } \
\text { of premium }
\end{array} & \begin{array} { c } 
\text { Expense }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Premium on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable, } \
\text { Including } \
\text { Premiun }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$
$$\begin{array}{l}
\text { Table B }\
\begin{array} { | c | c | c | c | c | c | c | } 
\hline \begin{array} { c } 
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l } 
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Amortization } \
\text { of Discount }
\end{array} & \begin{array} { c } 
\text { Interest } \
\text { Expense }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Discount on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable, net of } \
\text { discount }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$

Quizplus · Accepted Answer

The Answer of On January 1,2018,a company sells a 3-year bond with a face value of $50,000 and a stated interest rate of 7%.Because the market interest rate is 5%,the company receives $52,723 for the bond.The company uses the effective interest method of amortization.Fill in Table
A.Fill in Table B assuming the market interest rate is 9%,and the company received only $47,469 for the bond and the company uses the effective interest method.
$$\begin{array}{l}
\text { Table A }\
\begin{array} { | l | l | l | l | l | l | l | } 
\hline \begin{array} { c } 
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l } 
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Amortization } \
\text { of premium }
\end{array} & \begin{array} { c } 
\text { Expense }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Premium on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable, } \
\text { Including } \
\text { Premiun }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$
$$\begin{array}{l}
\text { Table B }\
\begin{array} { | c | c | c | c | c | c | c | } 
\hline \begin{array} { c } 
\text { Period } \
\text { Ended }
\end{array} & \begin{array} { l } 
\text { Interest } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Amortization } \
\text { of Discount }
\end{array} & \begin{array} { c } 
\text { Interest } \
\text { Expense }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Discount on } \
\text { Bonds } \
\text { Payable }
\end{array} & \begin{array} { c } 
\text { Bonds } \
\text { Payable, net of } \
\text { discount }
\end{array} \
\hline 01 / 01 / 18 & & & & & & \
\hline 12 / 31 / 18 & & & & & & \
\hline 12 / 31 / 19 & & & & & & \
\hline 12 / 31 / 20 & & & & & & \
\hline
\end{array}
\end{array}$$

On January 1,2018,a Company Sells a 3-Year Bond with a Face