Bond Discount, Entries for Bonds Payable Transactions On July 1, Year 1, Danzer Industries Inc. issued $8,300,000 of 8-year, 11% bonds at a market (effective) interest rate of 12%, receiving cash of $7,880,638. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year Required 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1. If an amount box does not require an entry, leave it blank Cash 7,880,638 Discount on Bonds Payable 419,362 Bonds Payable 08,300,000 Feedback Check My Work Bonds Payable is always recorded at face value. Any difference in issue price is reflected in a premium or discount account. The straight-line method of amortization provides equal amounts of amortization over the life of the bond Learning Objective 2 2. Journalize the entries to record the following: If an amount box does not require an entry, leave it blank. a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond discount, using the straight-line method. (Round your answer to the nearest dollar.) Interest Expense Discount on Bonds Payable Cash 456,500