What amount will be reported on nanas income statement for

Reference no: EM13566323

Nana's Pie Company prepared an amortization schedule to reflect a recent issue of bonds it sold. The schedule is presented below:

Year	Interest payment	Interest Expense	Amortization	Carrying Value of Bonds Payable
				$629,503
1	$42,000	$37,771	$ 4,229	625,274
2	$42,000	37,516	4,484	620,791
3	$42,000	.37,247	4,753	616,038
4	$42,000	36,962	5,038	611,000
5	$42,000	36,660	5,340	605,660
6	$42,000	36,340	5,660	600,000

Required:

Answer the following questions related to Nana's bond issue. (Include relevant explanations for your answers)

1. Did Nana issue the bonds at a premium or discount? Explain

2. What was the total face amount of the bonds issued?
3. What was the total issue price of the bonds?
4. What method did Nana use to amortize the difference between the issue price and face value? Explain

5. What amount will be reported on Nana's balance sheet at the end of period 3? Explain how it will be presented in that statement.

6. What amount will be reported on Nana's Income Statement for period 4? Explain how it will be presented on that statement.

Reference no: EM13566323

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