Reference no: EM133155441

Question - On August 1, 2022, Strouse Products issued 8.5% bonds, dated August 1,with a face amount of $240 million. The bonds mature on July 31,2027 (5 years). The market yield for bonds of similar risk and maturity was the rate calculated above. The market rate of interest is % 11.8.

1) Determine the price of the bonds issued on August 1, 2022 using Excel. Remember that the bonds pay semiannual interest. Please label this calculation in your spreadsheet.

2) Prepare an amortization schedule that calculates Strouse's interest expense using the effective interest method.

3) Prepare the journal entries to record the issuance of the bonds by Strouse on August 1, 2022.

4) Prepare journal entries to show the accrual of interest at year end, the payment of semi-annual interest, and the retirement of the bonds. You will have two journal entries in 2022 (one for the issuance and one for accrual of interest), three journal entries in years 2023-2026 (two for the semi-annual payments of interest and one for accrual of interest), and three in 2017 (two for the semi-annual payments of interest and one for the retirement of the bonds)