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On January 1, 2022, Art Inc. issued 9% bonds dated January 1,2020 , with a face amount of $200,000. The bonds mature in 10 years.
On January 1, 2022, Art Inc. issued 9% bonds dated January 1,2020 , with a face amount of $200,000. The bonds mature in 10 years. The effective interest rate for these bonds was 9.4%. Interest is paid semiannually on June 30 and December 31. Art Inc. paid investment banking fees of $28,000 related to the bond issuance. Art Inc.'s fiscal year is the calendar year. Art Inc. uses the effective interest method of amortization. 1. Prepare the journal entry to record the bond issuance on January 1, 2020. 2. Prepare the necessary journal entries on June 30 and December 31, 2020. 3. Prepare the necessary journal entry on June 30, 2021. 4. Prepare the June 30 and December 31, 2020 interest journal entries assuming that Art Inc. uses the straight-line method
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