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On January 2012, Down Under Co announced an offer to issue bonds with a $500,000 par value, a 8% annual contract rate with interest payable semi-annually, and with a three-year life to gain some liquidity given the current market conditions. Interest payments are due on April 1 and October 1 of each year. Down Under agrees to make six payments over the three years of the bond. Bonds are issue on April 1st 2012, maturity date is April 1, 2015 and the market rate on April 1st 2012 is 10%. Down Under Co. closes its books annually on December 31 and uses the effective interest method.

Hi please i need help with how to find the first bond discount amount at the end of the period and the net liability using the effective interest method

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