Exercise $10-20$A $($Algo$)$ Effective interest amortization of a bond discount LO $10-6$

On January $1,$ Year $1,$ Parker Company issued bonds with a face value of $\backslash (\backslash$$ $81,000\backslash ),$ a stated rate of interest of $12$ percent, and a fiveyear term to maturity. Interest is payable in cash on December $31$ of each year. The effective rate of interest was $14$ percent at the time the bonds were issued. The bonds sold for $\backslash (\backslash$$ $75,438\backslash ).$ Parker used the effective interest rate method to amortize the bond discount.

Required

a$.$ Prepare an amortization table.

b$.$ What item$($s$)$ in the table would appear on the Year $4$ balance sheet?

c$.$ What item$($s$)$ in the table would appear on the Year $4$ income statement?

d$.$ What item$($s$)$ in the table would appear on the Year $4$ statement of cash flows?

Complete this question by entering your answers in the tabs below.

Req A

Req B to D

Prepare an amortization table.

Note: Round your intermediate calculations and final answers to the nearest whole dollar amount. Complete this question by entering your answers in the tabs below.

Req A

Req B to D

b$.$ What item$($s$)$ in the table would appear on the Year $4$ balance sheet?

c$.$ What item$($s$)$ in the table would appear on the Year $4$ income statement?

d$.$ What item$($s$)$ in the table would appear on the Year $4$ statement of cash flows?

Note: Round your intermediate calculations and final answers to the nearest whole dollar amount.

b$.$ Carrying value

c$.$ Interest expense

d$.$ Cash outflow for interest