Instructions Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 2041Smiley issued $12,700,000 of five year, 11% bonds at a market (effective) interest rate of 9%, receiving cash of $13,704,946. Interest is payable semiannualy on April 1 and October 1. Required: a. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles 1. Issuance of bonds on April 1, 20Y1. 2. First interest payment on October 1, 2011, and amortization of bond premium for six months, using the straight-line method (Round to the nearest dollar) b. Explain why the company was able to issue the bonds for $13,704,946 rather than for the face annount of $12,700,000 How does sreding work? PAGE 10 Score: 65/75 ACCOUNTING EQUATION ASSETS LIABILITIES EQUITY DATE DET CREDIT Apr. 1 13,704,946.00 Cash Bonds Payable Premium on Bonds Payable 13,000,000.00 704,946.00 Oct 1 Interest Expense 514 505.40 Premium on Bonds Payable 70,494.60 Cash 585,000.00 Instructions Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 2041Smiley issued $12,700,000 of five year, 11% bonds at a market (effective) interest rate of 9%, receiving cash of $13,704,946. Interest is payable semiannualy on April 1 and October 1. Required: a. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles 1. Issuance of bonds on April 1, 20Y1. 2. First interest payment on October 1, 2011, and amortization of bond premium for six months, using the straight-line method (Round to the nearest dollar) b. Explain why the company was able to issue the bonds for $13,704,946 rather than for the face annount of $12,700,000 How does sreding work? PAGE 10 Score: 65/75 ACCOUNTING EQUATION ASSETS LIABILITIES EQUITY DATE DET CREDIT Apr. 1 13,704,946.00 Cash Bonds Payable Premium on Bonds Payable 13,000,000.00 704,946.00 Oct 1 Interest Expense 514 505.40 Premium on Bonds Payable 70,494.60 Cash 585,000.00