The effective interest method to amortize the premium

Question

Prairie Dunes Co. issues bonds dated January 1, 2011, with a par value of $860,000. The bonds' annual contract rate is 10%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $905,068.

Prepare an amortization table for these bonds using the effective interest method to amortize the premium.(Make sure that the unamortized premium equals to '0' and the Carrying value equals the face value of the bond in the last period. Leave no cells blank - be certain to enter "0" wherever required. Bond interest expense in the last period should be calculated as Cash interest paid (?) Premium amortized. Round your intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Semiannual Interest Period-End

(A) Cash Interest Paid

(B) Bond Interest Expense

(C) Premium Amortization

(D) Unamortized Premium

(E) Carrying Value

1/01/2011

$

$

6/30/2011

$

$

$

12/31/2011

6/30/2012

12/31/2012

6/30/2013

12/31/2013

Total

$

$

$