University of Central Florida Lan Corporation Issue Price of The Bonds Worksheet Requirement 1: Compute the issue price of the bonds on 1/1/2007 Requireme

University of Central Florida Lan Corporation Issue Price of The Bonds Worksheet Requirement 1: Compute the issue price of the bonds on 1/1/2007

Requirement 2: Using the effective interest method compute the interest payment, interest expense and amortization of the bonds over the 3-year term.

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– show your calculation

-Note: Due to rounding of the factors your final entry 12/31/2012 will cause the book value of the bond to be slightly over but no more than $100

Requirement 3: Prepare the journal entries that were made for 2007 and 2008.

-Hint: you should have three journal entries

(PV ss, n=3, i=12%)=0.712;(PV ann, n=3, i=12%)=2.402;(FV ss, n=3, i=12%)=1.405;(FV ann, n=3, i=12%)=3.374

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