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Problem 14-5 (Algo) Issuer and investor; effective interest; amortization schedule; adjusting entries [LO142] On February 1, 2021, Cromley Motor Products issued 12% bonds, dated February

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Problem 14-5 (Algo) Issuer and investor; effective interest; amortization schedule; adjusting entries [LO142] On February 1, 2021, Cromley Motor Products issued 12% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 14%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $60,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (EV of \$1. PV of \$1. EVA of \$1. PVA of \$1. EVAD of \$1 and PVAD of \$1) (Use appropriate factor(s) from the tables provide Required: 1. Determine the price of the bonds issued on February 1,2021 2-a. Prepare amortization schedules that indicate Cromley's effective interest expense for each interest period during the term to maturity. 2-b. Prepare amortization schedules that indicate Barnwell's effective interest revenue for each interest period during the term to maturity. 3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell's investment on February 1,2021. 4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31,2023. Complete this question by entering your answers in the tabs below. Determine the price of the bonds issued on February 1, 2021. (Do not round intermediate calculations. Enter your answer in whote dollars.) Problem 14-5 (Algo) Issuer and investor; effective interest; amortization schedule; adjusting entries [LO142] On February 1, 2021, Cromley Motor Products issued 12% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 14%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $60,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (EV of \$1. PV of \$1. EVA of \$1. PVA of \$1. EVAD of \$1 and PVAD of \$1) (Use appropriate factor(s) from the tables provide Required: 1. Determine the price of the bonds issued on February 1,2021 2-a. Prepare amortization schedules that indicate Cromley's effective interest expense for each interest period during the term to maturity. 2-b. Prepare amortization schedules that indicate Barnwell's effective interest revenue for each interest period during the term to maturity. 3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell's investment on February 1,2021. 4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31,2023. Complete this question by entering your answers in the tabs below. Determine the price of the bonds issued on February 1, 2021. (Do not round intermediate calculations. Enter your answer in whote dollars.)

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