On January 1,2015, Shay issues $700,00 of 10%, 15-year bonds at price of 97 and 3/4. Six years later, on January 1,2021, Shay retires 20% of these bonds by buying them on the open market at 104 and 1/2. All interest is accounted for and paid through December 31,2020, the day before the purchase. The straight-line method is used to amortize any bond discount.

1. how much does the company receive when it issues the bonds on January 1, 2015?

2. What is the amout of the discount on the bonds on January 1,2015?

3. How much amortization of the discount is recorded on the bonds for the entire period from January 1,2015, through December 31,2020?

4. What is the carrying (book) value of the bonds as the close of the business on December 31,2020? What is the carrying value of 20% soon -to-be-retired bonds on this same date?

5. How much did the company pay on January 1,2021, to purchase the bonds that it retired?

6. What is the amount of the recorded gain or loss from retiring the bonds?

7. Prepare the journal entry to record the bond retirement at Janurary 1,2021.