On January 1 2016, Natually Good Products issued $900,000 par value, 7%, five year bonds. Interest is payable semiannually at the end of the period. The market rate of interest on the date of the bond issue was 6%. The company's fiscal year ends on dec 31.

a) Determine issue price of debt.

b) Prepare Journal entry Record issuance of bonds payable. Record first semiannual interest payment. Record payment of the bonds at maturity.

Now, Prepare the journal entry to record the early retirement of the bonds at the end of the third year 2018 for 959,000