Romero issues $3,400,000 of 10%, 10-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $3,010,000.

Required

1. Prepare the January 1 journal entry to record the bonds’ issuance.

2. For each semiannual period, compute (a) the cash payment, (b) the straight-line discount amortization, and (c) the bond interestexpense.

3. Determine the total bond interest expense to be recognized over the bonds’ life.

4. Prepare the first two years of a straight-line amortization table like Exhibit 14.7.

5. Prepare the journal entries to record the first two interest payments.