From Example 14 umewe ve Straight Line Method) Example 14A. 1: On January 1, 2016, the Ruffin Corporation issued $40,000 par value, 4%, four-year bonds that mature on December 31, 2019. Ruffin will pay interest semiannually on June 30 and December 31. On the date Ruffin issued the bonds, the market rate of interest was 6%. The company's fiscal year ends on December 31. What is the issue price of this bond? Prepare the journal entry to record the issuance. Prepare an amortization schedule over the four-year period using the STRAIGHT LINE method Prepare the journal entries to record the interest entries for the first year. Prepare the journal entry to record the payment of the bonds at maturity. Prepare the t-accounts 7 for the bond payable and bond discount accounts for the life of the bond. 9 Since stated interest rate market interest rate 6, we can predict and prove that these bonds will be issued at a discount Face Value When we issue the bonds payable, we promise to por (1) Cash interest every semiannual year - Face Value of the Blonds Payable (2) Principal of S 000 at the end of the thyer Every period w pay carest 16 Awal Market Interest Rate Market interest Rate 1 Malatestate Somannual stated interest Rate Number of periods Face Value of the Bonds Payable yable is ved at a count 11232Pre Present Valthed ds Face Value of the Bonds Payable $40,000 Present Value of the Bonds Payable SACO The Bonds payable is issued at a discount $11232 - Face Value Present Value of the Bonds Payable Total Interest expense Total Cash interest. Tots Discount S-L Interest Expense Discount Amortired (S-L Method) Carrying Value (Prior CV Discount amortid) Period 0 Date Cash Interest 1 /1/2016 1 6/30/2016 2 12/28/2016 1 /21/2017 4 12 /2017 6/24/2018 6 12/22/2018 212019 12/19/2019 Bonds Povable less Discount on Eve