On February 1, 2021, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $90 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $90,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Determine the price of the bonds issued on February 1, 2021. 2-a. Prepare amortization schedules that indicate Cromley's effective interest expense for each interest period during the term to maturity. 2-b. Prepare amortization schedules that indicate Barnwell's effective interest revenue for each interest period during the term to maturity. 3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell's investment on February 1, 2021. 4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2023. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2A Req 2B Req3 Req 4 Cromley Req 4 Barnwell Determine the price of the bonds issued on February 1, 2021. (Do not round intermediate calculations. Enter your an: whole dollars.) Price of the bonds Reg 1 Reg 2A Reg 2B Req3 Reg 4 Cromley Req 4 Barnwell Prepare amortization schedules that indicate Cromley's effective interest expense for each interest maturity. (Do not round intermediate calculations. Enter your answers in whole dollars.) Payment Number Cash Payment Effective Interest Increase in Balance Outstanding Balance 1 2 3 4 5 5 6 7 8 Totals Prepare amortization schedules that indicate Barnwell's effective interest revenue for each interest period during th maturity. (Do not round intermediate calculations. Enter your answers in whole dollars.) Payment Number Cash Payment Effective Interest Increase in Balance Outstanding Balance 1 2 2 3 4 01 6 7 8 Totals Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell's investment on February is required for a transaction/event, select "No journal entry required" in the first account field. Do not round interm Enter your answers in whole dollars.) View transaction list Journal entry worksheet Record the issuance of the bonds by Cromley. Note: Enter debits before credits. General Journal Debit Credit Date February 01, 2021 Record entry Clear entry View general journal Reg 1 Reg 2A Reg 2B Reg 3 Req 4 Cromley Req 4 Barnwell Prepare the journal entries by Cromley to record all subsequent events related to the bonds through January 31, required for a transaction/event, select "No journal entry required" in the first account field. Do not round interm Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 2 3 4 5 6 Record the payment of interest for Cromley Company. Note: Enter debits before credits. General Journal Debit Credit Date July 31, 2021 Record entry Clear entry View general journal Reg 1 Reg 2A Reg 2B Req3 Req 4 Cromley Req 4 Barnwell Prepare the journal entries by Barnwell to record all subsequent events related to the bonds through January 31, required for a transaction/event, select "No journal entry required" in the first account field. Do not round interm Enter your answers in whole dollars.) View transaction list Journal entry worksheet Record the receipt of interest for Barnwell Company. Note: Enter debits before credits. General Journal Debit Credit Date July 31, 2021 Record entry Clear entry View general journal
