Bond amortization schedule and journal entries 27 minutes

On April 1, 2020, Balsam Company issues a $1,000,000 10-year 4% bond. The market rate of interest is 5%. As the market rate is higher than the bond rate, the bonds issue at a discount. The bond quote is 92.205. The bonds pay interest semi-annually on April 1 and October 1. The Companys fiscal year end is October 31.

Required:

a) Prepare a bond amortization schedule for the issuance and the first two interest periods.

b) Record the journal entry required on:

i. The issuance of the bond (April 1, 2020)

ii. The companys fiscal year-end (October 31, 2020)

iii. The second interest payment (April 1, 2021)