Sunny Resort issues $58 million in bonds on January 1, 2021, that pay interest semiannually...
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Accounting
Sunny Resort issues $58 million in bonds on January 1, 2021, that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below:
(1)
(2)
(3)
(4)
(5)
Cash Paid for
Interest
Decrease in
Carrying
Date
Interest
Expense
Carrying Value
Value
1/1/2021
$
65,279,805
6/30/2021
$
1,740,000
$
1,631,995
$
108,005
65,171,800
12/31/2021
1,740,000
1,629,295
110,705
65,061,095
Use the above information to complete the following:
1a) Where the bonds issued at face amount, a discount, or a premium and what is the original issue price of the bonds? What is the face amount of the bonds?
1b) What is the stated annual interest rate? What is the market interest rate?
1c) What is the total cash paid for interest assuming the bonds mature in 20 years?
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