I only need help with number 4!

Otter Products Inc. issued bonds on January 1, 2019. Interest is to be paid semi-annually. Other information is as follows:

Term in years: 2

Face value of bonds issued: $200,000

Issue price: $206,000

Specified interest rate each payment period: 6%

Required:

1 Calculate:

a. The amount of interest paid in cash every payment period.

b. The amount of amortization to be recorded at each interest payment date (use the straight-line method).

2 Complete this amortization table by calculating interest expense, and beginning and ending bond carrying amounts at the end of each period over two years.

Amortization Table

A B C D E

(A + D)

Year Period ending Beg.bond carrying amount Periodic interest expense Actual cash interest paid Periodic discount (prem.) amort. Ending bond carrying amount

2019 Jun. 30 206000 10500 12000 -1500 204500

Dec. 31 204500 10500 12000 -1500 203000

2020 Jun. 30 203000 10500 12000 -1500 201500

Dec. 31 201500 10500 10500 12000 -1500 200000

2021 Jun. 30 200000

Dec. 31 200000

3 Calculate the actual interest rate under the straight-line method of amortization for each six-month period. Round all percentage calculations to two decimal placed. Use the following format:

A B

Six month period ending Bond carrying amount Six-month interest expense

%

Year (B/A)

2019 Jun. 30 204500 10500 5.13

Dec. 31 20300 10500 5.17

2020 Jun. 30 201500 10500 5.21

Dec. 31 200000 10500 5.25

2021 Jun. 30

Dec. 31

4 Prepare the journal entry for December 31, 2019.