On May 1, 2020, Ezzy Corporation issued a 7-year bond worth $384,000 with an interest rate of 9% per annum. Interest is to be paid semi-annually on October 31 and April 30. At the time of the issuance, the market interest rate was 10%. Ezzy Corporation amortizes any premium or discount using the effective interest method.

A) Calculate the bond issue price and the resulting premium or discount. Bond Issue Price: Premium or Discount: B) Prepare journal entries to record the following bond payable transactions. 1) Issuance of bonds on May 1, 2020.

Date	Account Title and Explanation	Debit	Credit
May 1
	To record bond issuance

2) Payment of interest and amortization of premium or discount on October 31, 2020.

Date	Account Title and Explanation	Debit	Credit
Oct 31
	To record the first payment of interest and amortization

3) Accrual of interest and amortization of premium or discount on December 31, 2020, which is the company's year-end.

Date	Account Title and Explanation	Debit	Credit
Dec 31
	To record the interest accrued on bonds payable

4) Payment of interest and amortization of premium or discount on April 30, 2021.

Date	Account Title and Explanation	Debit	Credit
Apr 30
	To record payment of interest and amortization

5) Redemption of the bond for its face value one year before maturity on May 1.

Date	Account Title and Explanation	Debit	Credit
May 1
	Redemption of bond