On January 1, 2012 Morgan's Motors issued $500,000 of 3-year, 8% bonds when the market yield was 6%. The bond agreement stated that compounding was semi-annual with payments due on June 30 and December 31.
Calculate the proceeds from the bond issue. (Use Excel formulas or use at least 5 decimal places in present value factors if you use the tables at the back of your book. Show calculations.)Prepare an amortization table for the bonds using the effective interest method