Bond Discount, Entries for Bonds Payable Tronsactions, Interest Method of Amortizing Bond Discount On July 1, Year 1, Livingston Corporation, a wholesaler of manufacturing equipment, issued $46,000,000 of 20 -year, 10\% bonds at a market (effective) interest rate of 11%, recelving cash of $42,309,236. Interest on the bonds is payable semiannually on December 31 and June 30 . The fiscal year of the company is the calendar year. Required: For all journal entries with a compound transaction, if an amount box does not require an entry, leave it blank. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds: Year 1, July 1 Discount on Bonds Payable Bonds Parabie Feethas r Check My Wok Gonds Payable is always recorded at face value. Amy difference in issue price is reflected in a premum or discount account. 2. Journalize the entries to record the following: a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond discount; using the interest method. (Round to the nearest dollar.) Year 1, Dec. 31 Interest Expense Digcount on Bonds Payable x Fredpach b. The interest payment on June 30, Year 2, and the amortization of the bond discount, using the interest method. (Round to the nearest dollar.) Year 2, June 30 intermst txpense v 3. Determine the total interest expense for Year 1