Entries for Issuing Bonds and Amortizing Discount by Straight-Line Method On the first day of its fiscal year, Chin Company issued $19,400,000 of five-year, 10% bonds to finance its operations of producing and seting home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 12%, resulting in Chin receiving cash of $17,972,053. a. Journalize the entries to record the following: 1. Issuance of the bonds. 2. First semiannual interest payment. The bond discount is combined with the semiannual interest payment. (Round your answer to the nearest dollar) 3. 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 it blank. 1. Cash Discount on flends Payale Bonds Payable 2. Intersat Expense Dacoust on Bonds Payalde Cash 3. Interest tense Discount on Bonds Payable 17,972,053 142734 x D 970.m 900,000 Check My Wor Bonds Payable is always recorded at face value. Any difference in issue price is reflected in a premium or discount account. The straight-line method of amortization provides equal amounts of amortization Cash V70,000 Check My Work Bonds Payable is always recorded at face value. Any difference in issue price is reflected in a premium or discount account. The straight-line method of amortization provides equal amounts of amortization over the life of the bond. b. Determine the amount of the bond interest expense for the first year. c. Why was the company able to issue the bonds for only $17,972,053 rather than for the face amount of $19,400,00071 the contract rate of interest. Therefore, inventors, The market rate of interest is willing to pay the full face amount of the bonds YO My W b. Remember that the amortization of a bond discount or premium affects the amount of interest expenses recorded. c. Bonds will be issued for either a higher or lower amount than the face value when the market and contract rates of interest are different