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Ellis Company issues 8.0%, five-year bonds dated January 1, 2021, with a $600,000 par value. The bonds pay interest on June 30 and December
Ellis Company issues 8.0%, five-year bonds dated January 1, 2021, with a $600,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $612,307. The annual market rate is 7.5% on the issue date. Required: 1. Compute the total bond interest expense over the bonds' life. 2. Prepare an effective interest amortization table for the bonds' life. 3. Prepare the journal entries to record the first two interest payments. No Date General Journal Debit Credit 1 June 30, 2021 Bond interest expense Premium on bonds payable Cash 24,000 December 31, 2 Bond interest expense 2021 Premium on bonds payable Cash 24,000 < Required 2 Required 3 > Required 1 Required 2 Required 3 Prepare an effective interest amortization table for the bonds' life. Note: Round your intermediate and final answers to the nearest whole dollar. Semiannual Interest Period- Cash Interest End 01/01/2021 06/30/2021 Paid Bond Interest Expense 12/31/2021 06/30/2022 12/31/2022 06/30/2023 12/31/2023 06/30/2024 12/31/2024 06/30/2025 12/31/2025 Total Premium Amortization Unamortized Premium Carrying Value < Required 1 Required 3 >
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