Bonds Practice Problem I IXYZ issued 20 year bonds with a total face value of $500,000. The interest rate (coupon rate) on the bonds was 4%. The market rate was 3.5%. 1. Are the bonds going to be sold at par, a premium, or a discount? 2. Assume the bonds are sold for $517,000. What would be the journal entry: (a) at the time of issuance, (b) when they make their first interest payment