Campoelt Inc. produces and sells ouldoot equipment. On July 1, 20Y1, Campooll issued $87,000,000 of 10 -yoar, 10\% bonds at a market (effoctive) interest rate of 9%, receiving cash of \$92,658,219. Interest on the bonds is payable semlanmuly on Decernber 31 and June 30 . The fiscal year of the company is the calendar year, Required: 1. Journalize the entry to record the amount of cash procends from the issuance of the bonds on July 1, 20Yt. 2. Journalize the ontries to record the following: a. The first semiannual interest payment on Docember 31, 20Yt, and the amortization of the bond premium, using the straighteline mothod. b. The interest payment on June 30, 20Y2, and the amortization of the bond promum, using the straight-ine method. 3. Detemine the total interest expense for 20y1. 4. Wair the bond proceeds atways be greater than the tace amount of the bonds when the contract rate is greater than the makbef rate of inhevest? 5. Compute the price of $92,658,219 receved for the bands by using the present value fables, CHART OF ACCOUNTS Campbell Inc. General Ledger ASSETS REVENUE 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 121 Accounts Receivable 611 Gain on Redemption of Bonds 122 Allowance for Doubtful Accounts 126 Interest Receivable EXPENSES 127 Notes Receivable 510 Cost of Merchandise Sold 131 Merchandise Inventory 515 Credit Card Expense 141 Office Supplies 516 Cash Short and Over 142 Store Supplies 521 Sales Salaries Expense 151 Prepaid Insurance 522 Office Salaries Expense 191 Land 531 Advertising Expense 192 Store Equipment 532 Delivery Expense 193 Accumulated Depreciation-Store Equipment 533 Repairs Expense 194 Office Equipment 534 Selling Expenses 195 Accumulated Depreciation-Office Equipment 535 Rent Expense 536 Insurance Expense LIABILITIES 537 Office Supplies Expense 210 Accounts Payable 538 Store Supplies Expense 221 Salaries Payable 541 Bad Debt Expense 231 Sales Tax Payable 561 Depreciation Expense-Store Equipment 232 Interest Payable 562 Depreciation Expense-Office Equipment 241 Notes Payable 590 Miscellaneous Expense 251 Bonds Payable 710 Interest Expense 252 Discount on Bonds Payable 711 Loss on Redemption of Bonds 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid-In Capital in Excess of Par-Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331 Paid-In Capital from Sale of Treasury Stock 340 Retained Eamings 351 Cash Dividends 352 Stock Dividends 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1,20Y1. 2a. Joumatize the entry to recond the first semiannual interest payment on December 31, 20Y1, and the amortization of the bond premium, using the straight. Ene method General loumal instructions How does stading work? 2b. Joumalize the entry to record the interest payment on June 30, 20Y2, and the amortization of the bond premum, using the straight-ine method. probiem requirements. 500.140710.110710.087200.068770.054290.042910.03395 Present Value of Ordinary Annulty of $1 per Period \begin{tabular}{lllllllll} 18 & 12.65930 & 12.15999 & 11.68959 & 11.24607 & 10.82760 & 10.43247 & 10.05909 \\ \hline 19 & 13.13394 & 12.59329 & 12.08532 & 11.60765 & 11.15812 & 10.73471 & 10.33560 \\ \hline 20 & 13.59033 & 13.00794 & 12.46221 & 11.95038 & 11.46992 & 11.01851 & 10.59401 \\ \hline 21 & 14.02916 & 13.40472 & 12.82115 & 12.27524 & 11.76408 & 11.28498 & 10.83553 \\ \hline 22 & 14.45112 & 13.78442 & 13.16300 & 12.58317 & 12.04158 & 11.53520 & 11.06124 \\ \hline 23 & 14.85684 & 14.14777 & 13.48857 & 12.87504 & 12.30338 & 11.77014 & 11.27219 \\ \hline 24 & 15.24696 & 14.49548 & 13.79864 & 13.15170 & 12.55036 & 11.99074 & 11.46933 \\ \hline 25 & 15.62208 & 14.82821 & 14.09394 & 13.41393 & 12.78336 & 12.19788 & 11.65358 \\ \hline 26 & 15.98277 & 15.14661 & 14.37519 & 13.66250 & 13.00317 & 12.39237 & 11.82578 \\ \hline 27 & 16.32959 & 15.45130 & 14.64303 & 13.89810 & 13.21053 & 12.57500 & 11.98671 \\ \hline 28 & 16.66306 & 15.74287 & 14.89813 & 14.12142 & 13.40616 & 12.74648 & 12.13711 \\ \hline 29 & 16.98371 & 16.02189 & 15.14107 & 14.33310 & 13.59072 & 12.90749 & 12.27767 \\ \hline 30 & 17.29203 & 16.28889 & 15.37245 & 14.53375 & 13.76483 & 13.05868 & 12.40904 \\ \hline 31 & 17.58849 & 16.54439 & 15.59281 & 14.72393 & 13.92909 & 13.20063 & 12.53181 \\ \hline 32 & 17.87355 & 16.78889 & 15.80268 & 14.90420 & 14.08404 & 13.33393 & 12.64656 \\ \hline 33 & 18.14765 & 17.02286 & 16.00255 & 15.07507 & 14.23023 & 13.45909 & 12.75379 \\ \hline 34 & 18.41120 & 17.24676 & 16.19290 & 15.23703 & 14.36814 & 13.57661 & 12.85401 \\ \hline 35 & 18.66461 & 17.46101 & 16.37419 & 15.39055 & 14.49825 & 13.68696 & 12.94767 \\ \hline 40 & 19.79277 & 18.40158 & 17.15909 & 16.04612 & 15.04630 & 14.14553 & 13.33171 \\ \hline 45 & 20.72004 & 19.15635 & 17.77407 & 16.54773 & 15.45583 & 14.48023 & 13.60552 \\ \hline 50 & 21.48218 & 19.76201 & 18.25593 & 16.93152 & 15.76186 & 14.72452 & 13.80075 \\ \hline \end{tabular} 3. Determine the total interest expense for 20Y. Additional instructions 4. Will the bond procoeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest? Yes No 5. Compute the price of $92,658,219 received for the bonds by using the present value tables