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a) cost $12,000 to Hom Furniture for office equipment. Office equipment will be depreciated using double-declining balance. The expected life of the equipment is 5 years.

b) Purchase store equipment for $30,000 from Foreign Photo Supply, Store equipment will be depreciated using double-declining balance. The expected life of the equipment is 5 years.

c) Issue $100,000, 7% (contract rate), 10-year bond that pays interest annually at an effective interest rate of 8% (market rate). A check is received for the proceeds of this issuance.

Round this calculation to the nearest penny.

Depreciation Schedules

(First year depreciation and amortization is for the month of December only)

Office Equipment Depreciation Schedule

Year	Cost	Accumulated Depreciation Beginning of Year	Book Value at Beginning of Year	Double-Decline Balance Rate	Depreciation Expense	Book Value at End of Year
Current Year
2
3
4
5
6						0

Store Equipment Depreciation Schedule

Year	Cost	Accumulated Depreciation Beginning of Year	Book Value at Beginning of Year	Double-Decline Balance Rate	Depreciation Expense	Book Value at End of Year
Current Year
2
3
4
5
6						0

Bond Amortization Schedule

Interest Payment Date	Interest Paid	Interest Expense	Discount Amortization	Unamortized Discount	Bond Carrying Amount
December 1st
Current Year
2
3
4
5
6
7
8
9
10
11					100,000.00

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