On January 1, 2024, XYZ issued five-year bonds with a face amount of $1,000,000 and a stated interest rate of 5% payable semiannually on June 30 and December 31. The market yield for bonds of similar risk and maturity was 6%.

1. Determine the issue price of the bonds. (provide the total issue price of the bonds in the blank space)

2. Prepare the journal entry to record their issuance by XYZ on

January 1, 2024.

3. Prepare the journal entry to record the payment of interest on 12/31/24 in XYZ's books using the effective interest method of amortization of bond premium or discount.

4. Complete the partial amortization schedule (for the years 2024-2026) that determines interest at the effective rate each period.

5. What is the total interest expense that will be recognized over the life of the bond?

6. What would be the net amount of the liability XYZ would report in its balance sheet at December 31, 2025?