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    rdkiran Posts: 1, Reputation: 1
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    Dec 15, 2010, 04:15 AM
    Bond premium discount amortisation for amortizing bonds.
    Hi,

    How the premium discount amortization for amortizing bonds is calculated using Effective interest rate method? Here are the cashflows for the bond.
    Date Principal Interest
    31/12/2009 -10,000,000
    31/12/2010 500,000
    31/12/2011 1,000,000 500,000
    31/12/2012 2,000,000 450,000
    31/12/2013 3,000,000 350,000
    31/12/2014 4,000,000 200,000

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