On January 1, 2013, Lowry Company issued eight-year bonds with a face value of $500,000 and a stated interest rate of 12%,

payable semiannually on June 30 and December 31. The market rate for bonds of this type would be 10%.

REQUIRED:

(a) Calculate the issue price of the bonds and the journal entry to record the issuance.

(b) Prepare the amortization table for the bonds for January 1, 2013- December 31, 2015.

(c) Prepare the necessary journal entry at December 31, 2013.

(d) Prepare the necessary journal entry at June 30, 2015.