On January 1, 2020, Everly Bottle Company sold $3,000,000 in long-term bonds. The bonds will mature in 10 years and have a stated interest rate of 8% and a yield rate of 10%. The bonds pay interest annually on December 31 of each year. The bonds are to be accounted for under the effective-interest method.

Required:

a. Calculate the issue price of the bonds (i.e. bond proceeds)

b. Prepare the 1) entry at the time of bond issuance, 2) the adjusting entry for December 31, 2020 and 3) adjusting entry for December 31, 2021.

(Please show work, I don't fully understand the material and need to learn it for class in a few days. Thanks!)