On January 1, 2025, Culver Company sold 12% bonds having a maturity value of $1,030,000 for $1,194,499.65, which provides the bondholders with a 8% yield. The bonds are dated January 1, 2025, and mature January 1, 2030, with interest payable December 31 of each year. Culver Company allocates interest and unamortized discount or premium on the effective-interest basis. Prepare a schedule of interest expense and bond amortization for 2025-2027. (Round answer to 2 decimal places, e.g. 35548 Credit Cash (12%) Schedule of Interest Expense and Bond Premium Amortization Effective-Interest Method 12% Bonds Sold to Yield 10% Debit Interest Expense (10%) Debit Bond Premium Date 1/1/25 $ 12/31/25 12/31/26 123600 123600 12/31/27 123600 i i The following amortization and interest schedule reflects the issuance of 10-year bonds by Sheridan Corporation on January 1, 2019, and the subsequent interest payments and charges. The company's year-end is December 31, and financial statements are prepared once yearly. Amortization Schedule Year Cash Interest Amount Unamortized Carrying Value 1/1/2019 $40,151 $ 119,849 2019 $16,000 $17,977 38,174 121,826 2020 16,000 18,274 35,900 124,100 2021 16,000 18,615 33.285 126,715 2022 16,000 19,007 30,278 129,722 2023 16,000 19,458 26,820 133,180 2024 16,000 19,977 22,843 137,157 2025 16,000 20,574 18,269 141,731 2026 16.000 21,260 13,009 146,991 2027 16,000 22,049 6,960 153,040 2028 16,000 22,960 160,000 a. Indicate whether the bonds were issued at a premium or a discount. Premium b. Indicate whether the amortization schedule is based on the straight-line method or the effective-interest method. Effective-interest method c. Determine the stated interest rate and the effective-interest rate. The stated rate The effective rate 10 % % d. On the basis of the schedule above, prepare the journal entry to record the issuance of the bonds on January 1, 2019. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation January 1, 2019 Debit Credit e. On the basis of the schedule above, prepare the journal entry or entries to record the bond transactions and accruals for 2019. (Interest is paid January 1.) (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date December 31, 2019 Account Titles and Explanation Debit Credit f. On the basis of the schedule above, prepare the journal entry or entries to record the bond transactions and accruals for 2026. Sheridan Corporation does not use reversing entries. (Record entries in the order displayed in the problem statement. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation Debit Credit On January 1, 2020, Splish Corporation issued $5,180,000 of 10% bonds at 103 due December 31, 2029. Splish paid $77,000 in bond issue costs when the bonds were issue to the market. These will be amortized over the life of the bond. The premium on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method".) The bonds are callable at 105 (i.e., at 105% of face amount), and on January 2, 2025, Splish called one-half of the bonds and retired them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Splish as a result of retiring the $2,590,000 of bonds in 2025. Loss on redemption $ Prepare the journal entry to record the retirement. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation January 2, 2025 Bonds Payable Loss on Redemption of Bonds Premium on Bonds Payable Cash Debit 2590000 38850 Credit 2719500