Bonds Payable Journal Entries; Effective Interest Amortization On December 31, 2009, Kay Company issued $600,000 of five-year, 13% bonds payable for $650,798 yielding an effective interest rate of 10%. Interest is payable semiannually on June 30 and December 31. Prepare journal entries to reflect (a) the issuance of the bonds, (b) the semiannual interest payment and premium amortization (effective interest method) on June 30, 2010, and (c) the semiannual interest payment and premium amortization on December 31, 2010. Round amounts to the nearest dollar. General Journal Description Date Debit Credit a.) Dec.31 $ . Bonds Payable To record issuance of bonds. b.) Jun 30 Premium on Bonds Payable To record semiannual interest payment and premium amortization. Dec.31 Bond Interest Expense To record semiannual interest payment and premium amortization