What is total amount of interest expense incurred over

Reference no: EM13485607

For mostly the same info as last problem, i.e. for a $100,000 face value bond issued for Ritzy Diner, with 14% stated annual interest rate, paying interest semi-annually, with a two year maturity, but with issuance on July 1, 2014 and with interest payments on January 1 and July 1 thereafter, and with Ritzy using straight-line method:

1. What are proceeds of the issue if investors discount it at 10% annually?

2. Prepare a complete amortization table in good form

3. Prepare journal entry at issuance

4. Prepare any necessary journal entry on December 31, 2014

5. Prepare journal entry at first interest payment on January 1, 2015

6. What is total amount of interest expense incurred over course of the bond? Why is this the same or different from the total in extra problem 1?

Reference no: EM13485607

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