Kirpalani Limited wants to expand its furniture line. The board of directors have agreed that the fastest way to raise these funds is to issue bonds. The company proceeds to issue $$600,000,10\%$ bonds on March $1$st$,2020.$ The bonds pay interest on September $1$ and March $1.$ The due date of the bonds is September $1,2023.$ The bonds yield $12\%.$ The company closes its books on December $31.$

Requirements: $($Show all workings$)$

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I. Calculate the proceeds from the sale of the bond. Clearly show the amount of the premium or discount and state two reasons which support the premium or discount calculated. 

II$.$ Prepare a bond amortization schedule for the bond$$s life

  

 

III. Prepare all the journal entries for $2020$ & $2021$