On October 1, 2014, Rusuro Inc. issued a $1,500,000, 7%,

On October 1, 2014, Rusuro Inc. issued a $1,500,000, 7%, seven-year bond. Interest is to be paid annually each October 1.

Required
a. Calculate the issue price of the bond assuming a market interest rate of 6% on the date of the bond issue.
b. Using the effective interest method, prepare an amortization schedule similar to Exhibit 15.15.

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