8th EditionN. Gregory Mankiw
2nd EditionDavid Anderson, Margaret Ray
6th EditionN. Gregory Mankiw
5th EditionBen Bernanke, Robert Frank
ACCOUNTING On January 1, 2018, White Water issues $600,000 of 7%bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 6% and the bonds issued at$644,632. 1. Using an amortization schedule, show that the bonds have a carrying value of $633,887 on December 31, 2020. 2. If the market interest rate increases to 8% on December 31, 2020, it will cost$568,311 to retire the bonds. Record the retirement of the bonds on December 31, 2020.