1. On January 1, 2022 ABC Company issued 10-year bonds with a face value of $4,000,000 and a stated interest rate of 3% payable annually on December 31. The prevailing, rate of interest for this type of bond at the date of issuance was 4%. Answer parts i, ii, iii, iv

i. calculate the issue price of the bonds in dollars:

Future value of Present value of Present value of an an an Future Value of Present 1 i value of 1 0.74409 ordinary annuity 11.46338 12.00611 ordinary annuity 8.53020 8.11090 annuity due 8.78611 8.43533 10 10 1.34392 1.48024 3% 4% 0.67556 ii. Prepare the journal entry to record the January 1, 2022 issuance of bonds on ABC Company's books. Account Title Debit Credit iii. Prepare the journal entry to record the payment of interest on 12/31/24 on ABC Company's books using the effective interest method of amortization of bond premium or discount. Copy the table below to the textbox to show your answers. Account Title Debit Credit iv. The total interest expense that will be recognized over the life of the bond is