On January 1, when the market interest rate was 10 percent, Seton Corporation completed a $140,000, 8 percent bond issue for $122,790. The bonds pay interest each December 31 and mature in 10 years. Seton amortizes the bond discount using the straight-line method.

Required:

1. 1. & 2. Prepare the required journal entries to record the bond issuance and the first interest payment on December 31.

2. Prepare a bond discount amortization schedule for these bond

.

Changes During the Period Ending Bond Liability Balances Period Discount Interest Discount on Bonds Payable Bonds Pavable Carrying Value Cash Paid Ended Amortized Expense Start Yr 1 End 0 Yr 2 End Yr 3 End 0 Yr 4 End Yr 5 End Yr 6 End Yr 7 End Yr 8 End Yr 9 End Yr 10 End OOO