On October 31, 2019, Natalina Corporation issued $500,000 6% four year bonds, where interest is payable semi-annually on April 30 and October 31. The bonds were dated October 31, 2019 and mature on October 31, 2023. The accounting period ends on December 31. The market rate on date of issue was 8%.

1. Calculate the proceeds of the bond (price) on October 31, 2019.
2. Prepare a full amortization schedule using the effective-interest method of amortization, starting your schedule at October 31, 2019.
3. Provide all Journal entries required for the years 2019 and 2020, starting with the Bond issue on October 31, 2019. (HINT: Prepare entries for the initial issue, for the semi-annual interest payments and for the year end accruals.)
4. Assuming that on March 1, 2021 that 40% of the bonds are called in at a price of 102 (102% x face value) plus accrued interest. Record the journal entries on March 1, 2021 to pay off the interest to these bondholders and to record the redemption of the bonds.