On September 1, 2016, The Voice Productions Inc. (VPI) issued $3,520,000 of 8% bonds. Interest is payable semiannually on September 1 and March 1 with the bonds maturing September 1, 2026. The market rate of interest at the time of issuance was 9.5% and VPI uses the effective-interest method to amortize any premium or discount. Legal and other costs of $22,000 were incurred in connection with the issue and are being amortized on a straight-line basis over the life of the bond. Prepare answers to the following questions:

A. What is the present value of the $3,520,000 bonds on September 1, 2016? Show all supporting calculations.

B. Prepare the complete bond amortization table through September 1, 2026. (Again, consider using a spreadsheet)

C. Prepare the relevant journal entries for the bonds on the following dates: September 1, 2016 December 31, 2016 March 1, 2017 September 1, 2017

D. On December 1, 2017, VPI called the full bond issue at 90 in accordance with the provisions of the bond indenture and retired them. What is the gain or loss on the transaction?

E. Prepare all the necessary journal entries for December 1, 2017.