On December 31, 2019, Fett Corporation issued $850,000, 14%, 25-year bonds for $983,980 cash when the market rate of interest was 12%. The bonds pay interest semi-annually each June 30 and December 31. Vader uses the effective interest method of amortization to amortize and premium or discount.

Identify the following information: Face Value Stated Rate of Interest Annual Stated Interest Semi-Annual Stated Interest Price of the Bonds Premium or Discount (circle one)

Give the journal entry to record the issue of the bonds on December 31, 2019.

Prepare an effective interest amortization table through December 31, 2021 (the first four interest payment dates).

Give the journal entry(s) required on the first interest payment date, June 30, 2020.

Compute the following amounts: 1. Interest expense to be reported on the 2020 income statement 2. Interest expense to be reported on the 2021 income statement 3. Total interest expense over the life of the bond

Indicate the presentation of the bond liability on the December 31, 2021 balance sheet: of amortization had been used.