Clef, Inc. issues $500,000 of 8 year, quarterly bonds with a face rate

of 6%, priced to yield 8% (market rate). Please answer the following:

a) Is this bond sold at a discount or a premium? ____________________________

b) Please provide the entry recorded at issuance of the bonds?

c) Please provide the entry recorded for interest expense for payment #1:

2d) What is the total amount of interest expense recognized over the term (life) of the

bonds?

_______________________

2e) What is the present value of the bonds after the first payment?