The notes to the Helping Charities financial statements reported the following data on December 31, Year 1 (end of the fiscal year):

Helping Charities amortizes bonds by the effective-interest method and pays all interest amounts at December 31.

Requirements
1. Answer the following questions about Helping Charities long-term liabilities:
a. What is the maturity value of the 7% bonds?
b. What are Helping Charities annual cash interest payments on the 7% bonds?
c. What is the carrying amount of the 7% bonds at December 31, year 1?
2. Prepare an amortization table through December 31, Year 4, for the 7% bonds. The market interest rate on the bonds was 8%. (Round all amounts to the nearest dollar.) How much is Helping Charities interest expense on the 7% bonds for the year ended December 31, Year 4?
3. Show how Helping Charities would report the 7% bonds payable and the 6% notes payable at December 31, Year4.

Note 6. Indebtedness $3,000,000 Bonds payable, 7% due in Year 7 Less: Di Notes payable, 6%, payable in amounts of $55,000 (138,686) $2,861,314 annual installments starting in Year 330,000