Entries for issuing bonds and amortizing discount by straight$-$line method

On the first day of its fiscal year, Chin Company issued $$29,400,000$ of $5-$year, $7\%$ bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market $($effective$)$ interest rate of $9\%,$ resulting in chin receiving cash of $$27,073,731.$

a$.$ Journalize the entries to record the following:

Issuance of the bonds.

First semiannual interest payment. The bond discount is combined with the semiannual interest payment. $($Round your answer to the nearest dollar.$)$

Second semiannual interest payment. The bond discount is combined with the semiannual interest payment. $($Round your answer to the nearest dollar.$)$

If an amount box does not require an entry, leave $t$ blank.

b$.$ Determine the amount of the bond interest expense for the first year.

S$.(4)$

C$.$ Why was the company able to issue the bonds for only $$27,073,731$ rather than for the face amount of $$29,400,000?$

The market rate of interest is greater than $-$ Y the contract rate of interest, Therefore, inventors are not $y$ willing to pay the full face amount of the bonds.