MacBride Enterprises sold $200,000 of bonds on December 31, 2011. These bonds mature on December 31, 2018. A portion of the amortization table appears below.

Required:
1. Indicate the stated annual interest rate on these bonds.
2. Calculate the effective annual interest rate on these bonds
3. Determine the interest expense and premium amortization for the interest period ending December 31, 2013
4. Determine when the bonds will mature.

Transcribed Image Text:

Cash Payment Premium on Bonds Premium on Bonds Carrying Credit) Expense (Debit) Payable (Debit Payable Balance Vlue Interest Period $6,457 5,922 5,365 4,785 $206,457 205,922 205,365 204,785 ssue 06/30/12 $9,000 12/31/12 06/30/13 9,000 12/31/13 $8,465 8,443 8,420 $535 557 580 9,000