On January 1, 2018, Educators Credit Union (ECU) issued 6%, 20-year bonds payable with face value of 5100,000. The bonds pay interest on June 30 and December 31 Read the requirements Requirement 1. If the market interest rate is 5% when ECU issues its bonds will the bonds be priced at face value, at a premium, or at a discount? Explain The 6% bonds issued when the market interest rate is 5% will be priced at They are in this market, so investors will pay to acquire them Requirement 2. If the market interest rate is 7% when ECU issues its bonds will the bonds be priced at face value at a premium, or at a discount? Explain The 6% bonds issued when the market interest rate is 7% will be priced at They are in this market, so investors will pay to acquire them Requirement 3. The issue price of the bonds is 93. Joumalize the bond transactions (Assume bonds payable are amortized wing the straight line amortization method Record debits first, then credits Select explanations on the last line of the Journal entry. Check your spelling carefully and do not abbreviate Round your answers to the nearest whole dollar) a. Journalize the issuance of the bonds on January 1, 2018 Date Accounts and Explanation Debit Credit 2018 Jan 1 b. Joumalize the payment of interest and amortization on June 30, 2018 Date Accounts and Explanation 2018 Debit Credit Jun 30 Josimaluse the payment of interest and more on December 31, 2015 Account and Explanation 2010 (Que al C Requirements OUT Date 1. If the market interest rate is 5% when ECU issues its bonds, will the bonds be priced at face value at a premium, or at a discount? Explain. 2. If the market interest rate is 7% when ECU issues its bonds, will the bonds be priced at face value, at a premium, or at a discount? Explain 3. The issue price of the bonds is 93. Journalize the following bond transactions. a. Issuance of the bonds on January 1, 2018 b. Payment of interest and amortization on June 30, 2018 c. Payment of interest and amortization on December 31, 2018 d. Retirement of the bond at maturity on December 31, 2037, assuming the last interest payment has already been recorded. 2018 Dec 3 Print Done d. Retirement motomy on December 31, 2031. assuming the last tres payment has aready been recorded Date Accounts and Explanation Debit Credit 2037 Dec. 31 Choose from any list or enter any number in the input helds and then continue to the next question 319 PM 12/3/2017