Problem 10-4A Straight-Line: Amortization of bond discount LO P2

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Legacy issues $550,000 of 9.5%, four-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. They are issued at $507,301 when the market rate is 12%.

Problem 10-4A Part 2

2.Determine the total bond interest expense to be recognized over the bonds' life.

Problem 10-4A Part 3

3.Prepare a straight-line amortization table for the bonds' first two years.

Problem 10-4A Part 4

4.Prepare the journal entries to record the first two interest payments.

record the interest payment and amortization on June 30.