Problem 14-5 (Algo) Issuer and investor; effective interest; amortization schedule; adjusting entries [LO142] On February 1, 2024, Sanyal Motor Products issued 12% bonds, dated February 1, with a face amount of $85 million. - The bonds mature on January 31, 2028 (four 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 $85,000 of the bonds as a long-term investment. - The fiscal years of both firms end December 31. Required: 1. Determine the price of the bonds issued on February 1, 2024. 2-a. Prepare amortization schedules that indicate Sanyal'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 Sanyal and Barnwell's investment on February 1, 2024. 4. Prepare the journal entries by both firms to record all events related to the bonds through January 31,2026. Note: Use tables, Excel, or a financial calculator. (FV of \$1. PV of \$1. FVA of \$1. PVA of \$1. FVAD of \$1 and PVAD of \$1) Determine the price of the bonds issued on February 1,2024. Note: Do not round intermediate calculations. Enter your answer in whole dollars. Prepare amortization schedules that indicate Sanyal's effective interest expense for each interest period during the term maturity. Note: Do not round intermediate calculations. Enter your answers in whole dollars. Prepare amortization schedules that indicate Barnwell's effective interest revenue for each interest period during the term to maturity. Note: Do not round intermediate calculations. Enter your answers in whole dollars. Prepare the journal entries to record the issuance of the bonds by Sanyal and Barnwell's investment on February 1,2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars. Prepare the journal entries by Sanyal to record all events related to the bonds through January 31,2026. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars. Prepare the journal entries by Barnwell to record all events related to the bonds through January 31,2026. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars
