8) Prepare journal entries to record the following retirement. (Show computations and round to the nearest dollar.)

The December 31, 2014 balance sheet of a manufacturing company included the following items:

7.5% bonds payable due December 31, 2022 $2,000,000

Unamortized discount on bonds payable 80,000

The bonds were issued on December 31, 2012 at 95, with interest payable on June 30 and December 31. Management uses the straight-line amortization method.

On April 1, 2015, the company retired $400,000 of these bonds at 101 plus accrued interest.

Using the attached T-account format, prepare the entries:

a.March 30, 2015 to recognize the interest payable and the amortization of the discount on the $400,000 bonds to be retired

b.April 1, 2015 to pay the interest due on the $400,000 bonds to be retired

c.April 1, 2015 to retire the $400,000 of bonds