On March 1, 2014, Oaken Furniture Co. issued $700,000 of 10 percent bonds to yield 8 percent. Interest is payable semiannually on February 28 and August 31. The bonds mature in 10 years. Oaken Furniture Co. is a calendar-year corporation.

a.) Determine the issue price of the bonds. Show your computations.

b.) Prepare an amortization table through the first two interest periods using the effective-interest method.

c.) Prepare the journal entries to record bond-related transactions as of the following dates:

1.) March 1, 2014

2.) August 31, 2014

3.) December 31, 2014

4.) February 28, 2015