U NII Activity 5.a - Watch Works, D- Applying Formulas (1) Read the scenario and answer the three questions. (2) Fill in the table with the correct formulas, and then calculate the values the problem is solving for. When entering (1+I/Y) into the formulas, be sure to solve for (1+1/Y) and then enter the result rounded to two decimal places. The intermediary calculations should be rounded and entered to four decimal places. All dollar amounts should be rounded to the nearest whole dollar. Use these rounded answers in any applicable calculations that follow (3) Fill out the journal entry. On January 1, 2018, Watch Works Incorporated (WWI) issued $82,000 par value, 596, four-year bonds that mature on December 31, 2021. WWI will pay interest semiannually on June 30 and December 31. On the date WWI issued the bonds, the market rate of interest was 10%. The company's fiscal year ends on December 31. What is the issue price of this bond? Which of the following financial statement items is impacted in this transaction? Bonds Payable The problem is solving for: Present Value The calculation involves: Single Sum & Ordinary Annuity Formula Method STEP 1 - Present Value of Interest Payment: PV Ordinary Anncity PMT X 161 (1 1 (1+/ N 1) 1 = [01 (1 / 1.05 8 } 0.05 1 = STEP 2 - Present Value of Par Value: PV Pr x 1 (1/1 N 1/ X Present Value of Interest Payment Present Value of Par Value Journalize the issuance of the bonds. January 1, 2018 Debit Accounts Credit