ebook Bond Discount, Entries for Bonds Payable Transactions On July 1, 2071, Livingston Corporation, a wholesaler of manufacturing equipment, issued $5,000,000 of 5-ynar, 8% bonds at a market (effective interest rate of 10% receiving cash of $4,613,896. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: For all journal entries, if an amount box does not require an entry, leave it blank. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 2071. Cash Discount on Bonds Payable Bonds Payable Feedback Check My Wor Bonds Payable is always recorded at face valud. Any difference in issue orice is reflected in a premium or discount account. 2. Journalize the entries to record the following: a. The first semiannual interest payment on December 31, 2011, and the amortization of the band discount, using the straight-line method. Round to the nearest dolar. Interest Expense Discount on Bonds Payable Cash Deck My Work Previous All work ved Save and Submit Assignment for Grading EL JUR LISA HOW auairee b. The interest payment on June 30, 2012, and the amortization of the bond discount, using the straight-line method. Round to the nearest dollar. Interest Expense Discount on Bonds Payable 55 Cash Feedback Check My Work The straight-line method of amortization provides equal amounts of amortization over the life of the bond. 3. Determine the total interest expense for 201. Round to the nearest dollar 4. Will the bond proceeds always be less than the face amount of the bonds when the contract rate is less than the market rate of interest? Yes 5. Compute the price of $4,613,896 received for the bonds by using the present value tables in Apendix A. Round your PV values to s decimal places and the final answers to the nearest dollar. Your total may vary slightly from the price given due to rounding differences Present value of the face amount Present yalue of the semiannual interest payments Price received for the bonds Feedback Check My Work Previous All work saved Save and Exit Submit Assignment for Gradine