meet_ex5


Exhibit 5: Amortization of Bond Discount Using the Interest Method
$400,000 of 9%, five-year bonds (semi-annual interest payments) sold to yield 10% at January 1, 2001.

Selling price is calculated as follows:

Present value of $400,000 in 5 years $400,000 0.61391 $245,564.00  
Present value of interest payments $18,000 7.72173 $138,991.14
$384,555.14
 
Date Cash
payment
Interest expense Discount amortization Carrying value of bonds
January 1, ’01 — — — $384,555.14
July 1, ’01 $18,000.00 $19,227.76 $1,227.76 $385,782.90
January 1, ’02 $18,000.00 $19,289.14 $1,289.14 $387,072.04
July 1, ’02 $18,000.00 $19,353.60 $1,353.60 $388,425.64
January 1, ’03 $18,000.00 $19,421.28 $1,421.28 $389,846.93
July 1, ’03 $18,000.00 $19,492.35 $1,492.35 $391,339.27
January 1, ’04 $18,000.00 $19,566.96 $1,566.96 $392,906.24
July 1, ’04 $18,000.00 $19,645.31 $1,645.31 $394,551.55
January 1, ’05 $18,000.00 $19,727.58 $1,727.58 $396,279.13
July 1, ’05 $18,000.00 $19,813.96 $1,813.96 $398,093.08
January 1, ’06 $18,000.00 $19,906.92* $1,906.92 $400,000.00
*$2.27 rounding error

SPONSORED REPORT

2019 State of Financial Reporting Survey

We surveyed nearly 600 finance and accounting professionals on their month-end close and reporting processes. See the results.

VIDEO

What RPA is and how it works

Robotic process automation is like an Excel macro that can work on multiple applications, says Danielle Supkis Cheek, CPA. RPA can complete routine, repetitive tasks such as data entry, freeing up employee time from lower-level chores.