On January 1, 2019, Parker Advertising Company issued $50,000 of six-year, 3% bonds when the market interest rate was 4%. The bonds were issued for $47,356. Parker uses the effective-interest method of amortization for bond discount. Semiannual interest payments are made on June 30 and December 31 of each year. Prepare the amortization table for the first four interest payments. (Round your answers to the nearest dollar number.)
Explanation:
Cash paid each interest payment date = $50,000 × 3% × 6/12 = $750
First interest expense = $47,356 × 4% × 6/12 = $947
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