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On January 1, Year 1, Hart Company issued bonds with a face value of $120,000, a stated rate of interest of 13 percent, and a five-year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 12 percent at the time the bonds were issued. The bonds sold for $124,326. Hart used the effective interest rate method to amortize the bond premium.

Required

a. Prepare an amortization table.

b. What is the carrying value that would appear on the Year 4 balance sheet?

c. What is the interest expense that would appear on the Year 4 income statement?

d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows?

On January 1, Year 1, Hart Company issued bonds with a face value of $120,000, a stated rate of interest of 13 percent, and a five-year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 12 percent at the time the bonds were issued. The bonds sold for $124,326. Hart used the effective interest rate method to amortize the bond premium. Required a. Prepare an amortization table. b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the interest expense that would appear on the Year 4 income statement? d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows? Complete this question by entering your answers in the tabs below. Reg A Reg B to D Prepare an amortization table. (Round your intermediate calculations and final answers to the nearest whole number.) Interest Date Cash Payment Premium Amortization Carrying Expense Valute 124,326 123,645 15,600 14,919 681 January 1, Year 1 December 31, Year 1 December 31, Year 2 December 31. Year 3 December 31, Year 4 December 31, Year 5 Totals Req A Req B to D > On January 1, Year 1, Hart Company issued bonds with a face value of $120,000, a stated rate of interest of 13 percent, and a five-year term to maturity. Interest is payable in cash on December 31 of each year. The effective rate of interest was 12 percent at the time the bonds were issued. The bonds sold for $124,326. Hart used the effective interest rate method to amortize the bond premium. Required a. Prepare an amortization table. b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the interest expense that would appear on the Year 4 income statement? d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows? Complete this question by entering your answers in the tabs below. Reg A Req B to D b. What is the carrying value that would appear on the Year 4 balance sheet? c. What is the interest expense that would appear on the Year 4 income statement? d. What is the amount of cash outflow for interest that would appear in the operating activities section of the Year 4 statement of cash flows? (Round your intermediate calculations and final answers to the nearest whole number.) Show less b. Carrying value for Year 4 c. Interest expense for Year 4 d. Cash outflow for interest in Year 4

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