Jones Manufacturing sold $900,000 of 15-year, 7% notes for $822,186. The notes were sold January 1, 2020, and pay interest semiannually on June 30 and December 31. The effective interest rate was 8%. Assume Jones uses the effective interest rate method.
Required:
1. Prepare the entry to record the sale of the notes.
2. Determine the amount of the semiannual interest payments for the notes.
3. Prepare the amortization table through 2021.
4. Prepare the entry for Jones' journal at June 30, 2020, to record the payment of 6 months' interest and the related interest expense.
5. Determine interest expense for 2021.