On January 1, 2021, Hawk Co. issued $700,000 of 10%, 6-year bonds to yield 8%. The bonds pay interest on January 1 and July 1.

1. Calculate the bond issue price. Use Table 6-2 and 6-4 to get the present value factors. Round to the nearest dollar.

Bond Issue Price:

2. Use Excel formulas to construct the bond discount/premium amortization schedule. Lable the columns properly. Round to the nearest dollar. At the end, a few dollars difference caused by rounding is acceptable.

3. Prepare journal entries for the following dates.

1/1/21

7/1/21

12/31/21

1/1/22

PV of the Principal: PV of the Interest Payments: Bond Issue Price: XX XX PV Factor XX XX Schedule of Bond Discount/Premium Amortization Effective Interest Method