The Following Partial Amortization Schedule Is Available for Courtney Company $\text { BOND AMORTIZATION SCHEDULE }$

question 92

Multiple Choice

The following partial amortization schedule is available for Courtney Company who sold $750,000, five-year, 10% bonds on January 1, 2017 for $780,000 and uses annual straight-line amortization. $\text { BOND AMORTIZATION SCHEDULE }$
$\begin{array}{|l|c|c|c|c|c|}\hline \text { Interest Periods } & \begin{array}{c}\text { Interest } \\\text { to be paid }\end{array} & \begin{array}{c}\text { Interest } \\\text { expense }\end{array} & \begin{array}{c}\text { Premium } \\\text { Amortization }\end{array} & \begin{array}{c}\text { Unamortized } \\\text { Premium }\end{array} & \begin{array}{c}\text { Bond Carrying } \\\text { Value }\end{array} \\\hline \text { January 1,2017 } & & & & \$ 30,000 & \$ 780,000 \\\hline \text { January } 1,2018 & \text { (i) } & \text { (ii) } & \text { (iii) } & \text { (iv) } & (\mathrm{v}) \\\hline\end{array}$ Which of the following amounts should be shown in cell (iv) ?

• A)$33,000
• B)$27,000
• C)$36,000
• D)$24,000

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Definitions:

Capital Expenditures Budget

A financial plan dedicated to the projected spending on long-term assets that will deliver value in the future.

Sales Budget

An estimation of the revenue expected from sales activities over a certain period, used for financial planning and strategy.

Capital Expenditures Budget

A plan for the funds a company intends to spend on major physical assets, aimed at future benefits or investments.

Cash Budget

A financial plan that estimates cash inflows and outflows over a specific period, typically used to ensure that a company can meet its cash needs.