Determine the stated interest rate on the bonds

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Reference no: EM13941000

COMPLETING A DEBT AMORTIZATION TABLE (STRAIGHT LINE)

Cagney Company sold $200,000 of bonds on December 31, 2008. A portion of the amortization table appears below.

Period	Cash Payment (Credit)	Interest Expense (Debit)	Discount on Bonds Payable (Credit)	Discount on Bonds Payable Balance	Carrying Value
At issue				$6,000	$194,000
6/30/09	$11,000	$11,600	$600	5,400	194,600
12/31/09	11,000	11,600	600	4,800	195,200
6/30/10	?	?	?	?	?

Required:

1. Determine the stated interest rate on these bonds.

2. Calculate the interest expense and the discount amortization for the interest period ending June 30, 2010.

3. Calculate the liability balance shown on a balance sheet after the interest payment is recorded on June 30, 2010.

Reference no: EM13941000

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