Jamboree Company has 9%, 20-year bonds outstanding with a par value of $500,000. After the interest payment on June 30, the bonds have a carrying amount of $475,000. The company calls the bonds at $493,000 on July 1.

Required: i. Prepare the journal entry to record the retirement of the bonds on July 1.

ii. What are the advantages and disadvantages of bond financing? Identify at least two advantages and two disadvantages.