Calculator eBook Amortize discount by interest method t Value Tables Chart of Accounts Journal Instructions h On the first day of its fiscal year, Ebert Company issued $12,500,000 of 10 year, 7% bonds to finance its operations. Interest is payable semiannually. bond s were issued at a market (effective interest rate of 9%, resulting in Ebert receiving cash of $10,873,974. The company uses the interest method Required: Journalize the entries to record the following transactions. Refer to the Chart of Accounts for exact wording of account titles. 1. Sale of the bonds. 2. First semiannual interest payment, including amortization of discount. Round to the nearest dollar 3. Second semiannual interest payment, including amortization of discount Round to the nearest dollar. b. Compute the amount of the bond interest expense for the first year c. Explain why the company was able to issue the bonds for only $10,873,974 rather than for the face amount of $12,500,000. Present Value Tables