Instructions Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $30,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $31,951,110. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 20Y1.* 2. Journalize the entries to record the following:* a. The first semiannual interest payment on December 31, 20Y1, and the amortization of the bond premium, using the straight-line method. (Round to the nearest dollar.) b. The interest payment on June 30, 20Y2, and the amortization of the bond premium, using the straight-line method (Round to the nearest dollar.) 3. Determine the total interest expense for 20Y1. 4. Will the bond proceeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest? 5. Compute the price of $31,951, 110 received for the bonds by using the present value tables (Round to the nearest dollar) *Refer to the Chart of Accounts for exact wording of account titles. Present Value Tables 3 0 4 5 6 8 10 11 12 13 14 15 16 0.96154 0.92456 .88900 0.85480 0.82193 0.79031 0.75992 0.73069 0.70259 0.67556 0.64958 0.62460 0.60057 0.57748 0.55526 0.53391 0.51337 0.49363 .47464 0.45639 0.43883 0.42196 0.40573 0.95694 0.95238 0.91573 0.90703 0.87630 0.86384 0.83856 0.82270 0.80245 0.78353 0.76790 0.74622 0.734830.71068 0.70319 0.67684 0.67290 0.64461 0.64393 0.61391 0.61620 0.58468 0.58966 0.55684 0.56427 0.53032 0.53997 0.50507 0.51672 0.48102 0.49447 0.45811 0.47318 0.43630 0.45280 0.41552 0.43330 0.39573 0.41464 0.37689 0.39679 0.35894 0.37970 0.34185 0.36335 0.32557 0.94787 0.89845 0.85161 0.80722 0.76513 0.72525 0.68744 0.65160 0.61763 0.58543 0.55491 0.52598 0.49856 0.47257 0.44793 0.42458 0.40245 0.38147 0.36158 0.34273 0.32486 0.30793 0.29187 0.94340 0.93897 0.89000 0.88166 0.83962 0.82785 0.792090.77732 0.74726 0.72988 0.70496 0.68533 0.66506 0.64351 0.62741 0.60423 0.59190 0.56735 0.55839 0.53273 0.52679 0.50021 0.49697 0.46968 0.46884 0.44102 0.44230 0.41410 0.41727 0.38883 0.39365 0.36510 0.37136 0.34281 0.35034 0.32189 0.33051 0.30224 0.31180 0.28380 0.29416 0.26648 0.27751 0.25021 0.26180 0.23494 0.93458 0.87344 0.81630 0.76290 0.71299 0.66634 0.62275 0.58201 0.54393 0.50835 0.47509 0.44401 0.41496 0.38782 0.36245 0.33873 0.31657 0.29586 0.27651 0.25842 0.24151 0.22571 0.21095 18 19 20 0 22 23 Present Value lables www 25 26 28 29 30 0.39012 0.34770 0.37512 0.33273 0.36069 0.31840 0.34682 0.30469 0.33348 0.29157 0.32065 0.27902 0.30832 0.26700 0.29646 0.25550 0.28506 0.24450 0.27409 0.23397 0.26355 0.22390 0.25342 0.21425 0.208290.17193 .17120 0.13796 0.14071 0.11071 www ww. v 0.31007 0.27666 0.29530 0.26223 0.28124 0.24856 0.26785 0.23560 0.255090.22332 0.24295 0.21168 0.23138 0.20064 0.22036 0.19018 0.20987 0.18027 0.19987 0.17087 0.19035 0.16196 0.18129 0.15352 0.14205 0.11746 0.11130 0.08988 0.08720 0.06877 v io 0.24698 0.23300 0.21981 0.20737 0.19563 0.18456 0.17411 0.16425 0.15496 0.14619 0.13791 0.13011 0.09722 0.07265 0.05429 . .. 0.22060 0.20714 0.19450 0.18263 0.17148 0.16101 0.15119 0.14196 0.13329 0.12516 0.11752 0.11035 0.08054 0.05879 0.04291 .. 0.19715 0.18425 0.17220 0.16093 0.15040 0.14056 0.13137 0.12277 0.11474 0.10723 0.10022 0.09366 0.06678 0.04761 0.03395 32 33 34 35 40 45 50 0 Periods Present Value of Ordinary Annuity of $1 per Period 4.5% 5% 5.5% 6% 0.95694 0.95238 0.94787 0.94340 7% = 0.93458 N 2 4.0% 0.96154 1.88609 2.77509 3.62990 4.45182 1.87267 1.85941 2.74896 2.72325 3.58753 3.54595 4.389984.32948 w 1.84632 2.69793 3.50515 4.27028 6.5% 0.93897 1.82063 2.64848 3.42580 4.15568 1.83339 2.67301 3.46511 4.21236 1.80802 2.62432 3.38721 4.10020 4 5 Present Value Tables 5.24214 7 6.00205 8 6.73274 7.43533 108 .11090 8.76048 12 9 .38507 5.15787 5.075694.99553 4.91732 4.84101 4.76654 5.89270 5.78637 5.68297 5.58238 5.48452 5.38929 6.595896.46321 6.33457 6.209796.08875 5.97130 7.26879 7.10782 6.95220 6.801696.65610 6.51523 7.91272 7.721737.537637.360097.18883 7.02358 8.52892 8.30641 8.09254 7.88687 7.68904 7.49867 9.11858 8.86325 8.61852 3.38384 8.158737.94269 13 9 .98565 9.682859.39357 9.11708 8.85268 8.59974 8.35765 14 15 19 20 10.56312 10.22283 11.11839 10.73955 11.65230 11.23402 12.16567 11.70719 12.65930 12.15999 13.13394 12.59329 1 3.59033 13.00794 14.02916 13.40472 14.4511213.78442 14.85684 14.14777 15.24696 14.49548 15.62208 14.82821 15.98277 15.14661 16.32959 15.45130 16.66306 15.74287 9.89864 9.589659.294989.01384 8.74547 10.37966 10.03758 9.71225 9.40267 9.10791 10.83777 10.46216 10.10590 9.76776 9.44665 11.27407 10.86461 10.47726 10.110589.76322 11.6895911.24607 10.82760 10.43247 10.05909 12.08532 11.60765 11.15812 10.73471 10.33560 12.46221 11.95038 11.46992 11.01851 10.59401 12.82115 12.27524 11.76408 11.28498 10.83553 13.16300 12.58317 12.04158 11.53520 11.06124 13.48857 12.87504 12.30338 11.77014 11.27219 13.79864 13.15170 12.55036 11.99074 11.46933 14.09394 13.41393 12.78336 12.19788 11.65358 14.3751913.66250 13.00317 12.3923711.82578 14.64303 13.89810 13.21053 12.57500 11.98671 14.89813 14.1214213.40616 12.74648 12.13711 28 23 14.85684 14.1477 13.48857 12.87504 12.3038 177014 11.27219 15.24696 14.49548 13.79864 13.15170 12.55036 11.99074 11.46933 15.62208 14.82821 14.09394 1341393 12.78336 12.19788 11.65358 27 28 31 32 | 15.98277 15.14661 16.32959 15.45130 16.66306 15.74287 16.98371 16.02189 | 17.29203 16.28889 17.58849 16.54439 17.87355 16.78889 18.14765 17.02286 18.41120 17.24676 18.66461 17.46101 19.79277 18.40 158 20.72004 19.15635 21.48218 19.76201 14.37519 13.66250 14.64303 13.89810 14.89813 14.12142 15.14107 14.33310 15.37245 14.53375 15.59281 14.72393 15.80268 14.90420 16.00255 15.07507 16.19290 15.23703 16.37419 15.39055 17.15909 16.04612 17.77407 16.54773 18.25593 16.93152 13.00317 12.39237 11.82578 13.21053 12.57500 11.98671 13.40616 12.74648 12.13711 13.59072 12.90749 1227767 13.76483 13.05868 12.40904 13.92909 13.20063 12.53181 14.08404 1333393 12.64656 14.23023 13.45909 12.75379 14.36814 13.57661 12.85401 14.49825 13.68696 12.94767 15.04630 14.14553 13.33171 15.45583 14.48023 13.60552 15.76186 14.72452 13.80075 35 40 | 45 | 50 Final Questions 3. Determine the total interest expense for 20Y1. Enter amount as a positive number. $ 4. Will the bond proceeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest? Yes 5. Compute the price of $31,951, 110 received for the bonds by using the present value tables. Round to the nearest dollar Present value of the face amount Present value of the semiannual interest payments Price received for the bonds