Amortizing Debt Issuance and Bond Discounts

On January 1, 2019, Bake Corporation issued $100,000 5-year bonds due Dec. 31, 2023, for $92,278. The callable bonds carry a stated rate of interest of 8% payable semi-annually on June 1 and December 31 each year and were issued to yield 10%. The company uses the effective interest method of amortization to amortize any discounts or premiums.

The company called the bonds on December 31, 2021 for $99,000.

Required:

All work must be done in excel with formulas.

1. Complete journal entries to issue the bonds, all interest payments, and any discount or premium amortization from January 1, 2019, to December 31, 2021, when the bonds were called.

2. Complete the journal entry to call the bonds on December 21, 2021.

3. Complete the bond amortization table using excel.