Computing bond proceeds, entries for bond issuing and amortizing premium by straight-line method.

Lido Corporation wholesales oil and grease products to equipment manufactures. On March 1, 1997, Lido Corporation issued $1,000,000 of five- year, 12% bonds at an effective interest rate of 10%. Interest is payable semiannually on March 1 and September 1. Journalize the entries to record the following:

1. Sale of bonds on March 1, 1997, (Use the tables of present values in The Information Tab to determine the bond proceeds.)
2. First interest payment on September 1, 1997, and amortization of bond premium for six months, using the straight-line method. (Round to the nearest dollar).