Problem 1 Lloyd Inc. manufactures cycling equipment. Recently the vice president of operations of the company has requested construction of a new plant to meet the increasing demand for the company's bikes. After a careful evaluation of the request, the board of directors has decided to raise funds for the new plant by issuing $5,000,000 of 10% term corporate bonds on March 1, 2020, due on March 1, 2035, with interest payable each March 1 and September 1. At the time of issuance, the market interest rate for similar financial instruments is 8%. Instructions As the controller of the company, 1. Determine the Issue price of the bonds. 2. What is the journal entry made by Lloyd Inc. on Issue date? 3. Make the journal entries on the Sep 1, 2020 and March 1, 2021