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E10-10 (Algo) Preparing a Bond Amortization Schedule for a Bond Issued at a Discount and...

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E10-10 (Algo) Preparing a Bond Amortization Schedule for a Bond Issued at a Discount and Determining Reported Amounts LO10-4 On January 1 of this year, Ikuta Company issued a bond with a face value of $130,000 and a coupon rate of 4 percent. The bond matures in 3 years and pays Interest every December 31. When the bond was issued, the annual market rate of interest was 5 percent Ikuto uses the effective interest amortization method. (FV of $1. PV of $1. EVA of 5), and PVA of S1) (Use the appropriate factor(s) from the tables provided. Round your answers to whole dollars.) Required: 1. Complete a bond amortization schedule for all three years of the bond's life Book Value of Cash Interest Interest Expense Amortization Bond Date Jan 01 Year 1 Dec 31, Year 1 Dec. 31. Year 2 Dec. 31. Year 3 2. What amounts will be reported on the income statement and balance sheet at the end of Year 1 and Year 2? Year 1 Year 2 December 31 Interest expense Bonds payable

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