Prairie Dunes Company issues bonds dated January 1, 2011, with a par value of $800,000. The annual contract rate is 13%, 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 12%, and the bonds are sold for $819,700.
1.How much total bond interest expense will be recognized over the life of these bonds?
2. Prepare an amortization table ,use the straight-line method to amortize the premium.