On January 1, Sage Corporation issues bonds for $1,000,000, 5 years, 12% to 95% with interest payable on July 1 and January 1. The book value of the bonds at the end of the third interest period is:

2 On January 1, 2014, bonds for $2,000,000, 10 years, 10% were issued for $1,943,000. Interest is paid annually on January 1. If the issuing corporation uses the straight-line method to amortize the discount on bonds payable, the monthly amortization amount is:

3. A corporation issues a $500,000, 8%, 5-year bond on January 1, 2014, for $479,000. Interest is paid annually on January 1. If the corporation uses the bond discount straight-line amortization method, the amount of bond interest expense will be recognized on December 31, 2014.

Answer rating: 100% (QA)

Calculation of book value of bonds The face value of the bond is 1000000 and the bond is issued at 95 of the face value which is 950000 The bond carries a 12 interest rate payable semiannually so the ... View the full answer