HAND IN PROBLEM

Evercise $14-18$ Amortization of bond premium $($S$)$ LO$4,()6$

CHECK FGURE: a$.$ $$935,536($PV tables$)$ or $$935,560($calculator$)$; b$.$ Total interest expense: $$568,965($PV tables$)$ or $$568,940($calculator$)$

On October $1,2020,$ Best Biopherme Inc. issued an $$$50,000,11\%,$ seven$-$jear bond. Interest is to be peid annually each Oetober $1.$

Required

a$.$ Celculate the issue price of the bond assuming & market interest rate of $9\%.$

b$.$ Using the effective interest method, prepare an amortization schedule similar to Exhibit $14\mathrm{.}15$ using the effective intereset method