On April 1, 2006, US Ultracom issued 7%, 10-year bonds payable with maturity value of $400,000. The bonds pay interest on March 31 and September 30, and US Ultracom amortizes premium and discount by the straight-line method. continued , .. Long-Term Liabilities 765 Requirements 2. If the market interest rate is 8% when US Ultracom issues its bonds, mium, or at a discount? Explain. (pp. 735-736) will the bonds be priced at par, at a premium, or at a discount? Explain. (pp. 735-736) 3. Assume that the issue price of the bonds is 101. Journalize the fol- lowing bonds payable transactions: a. Issuance of the bonds on April 1, 2006. (pp. 744-745) b. Payment of interest and amortization of premium on September 30, 2006. (pp. 744-745) c. Accrual of interest and amortization of premium on December 31, 2006. (pp. 744745) d. Payment of interest and amortization of premium on March 31, 2007. (pp. 744745)