Eagle Corporation issued $9,990,000, 5 percent bonds dated April 1, year 1. The market interest rate was 6 percent, with interest paideach March 31. The bonds mature in three years, on March 31, year 4. Eagle's fiscal year ends on December 31. Use Table 8C.1, Table8C.2.Required:1. What was the issue price of these bonds? (Round time value factor to 4 decimal places. Round the final answer to the nearestwhole dollar.)Bond issue price$9,722,7682. Compute the interest expense for the period ended December 31, year 1. The company uses the effective-interest method ofamortization. (Round time value factor to 4 decimal places. Round intermediate and final answer to the nearest whole dollar.)Interest expense3. Show how the bonds should be reported on the statement of financial position at December 31, year 1. (Round intermediate andfinal answer to the nearest whole dollar.)EAGLE CORPORATIONAs of December 31, Year 1Statement of financial position:Bonds payable

Bonds:A bond is a fixed-income instrument because a bond is issued with a fixed rate of interest.…

Answered: Eagle Corporation issued $9,990,000, 5…

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

ChapterMB: Model-building Problems

Section: Chapter Questions

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Eagle Corporation issued $9,990,000, 5 percent bonds dated April 1, year 1. The market interest rate was 6 percent, with interest paid each March 31. The bonds mature in three years, on March 31, year 4. Eagle's fiscal year ends on December 31. Use Table 8C.1, Table 8C.2.