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c. Prepare the journal entry on Jan. 1, 2013 (date of issuance) and on June 30, 2013 (1st interest payment date). d. What amount will

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c. Prepare the journal entry on Jan. 1, 2013 (date of issuance) and on June 30, 2013 (1st interest payment date).

d. What amount will the company report as interest expense on their Income Statement for the year ended December 31, 2013? $ ____________________

e. What is the unamortized discount or premium on December 31, 2013 $ ___________________

f. XYZ Corporation buys back $300,000 worth of bonds (60% of its outstanding bonds) for $306,000 on January 31, 2014. Prepare all of the necessary journal entries to record this early redemption of bonds on January 31, 2014.

1. (39 pts) XYZ Corporation issued $500,000, 8%, 5 year bonds on January 1, 2013. These bonds will pay interest semi-annually on June 30 and December 31. When the bonds were sold, the effective rate of interest was 10%. XYZ's year end is December 31. a. (8 pts) Determine the selling price of the bonds: Note: Show your computation. Also, when you use present value tables, please round the table factors to three decimal places b. (13 pts) Prepare an amortization schedule for the first year using the effective interest method: (round to the nearest dollar) AMORTIZATION TABLE Date (A) Interest Expense (B) Cash Payment (C) Discount / Premium Amortization (D) Carrying Value Issuance 1 (June 30, '13) 2 (Dec 31, '13) 3 (June 30, '14)

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