Question 1) On December 31, 20x0, an entity issues bonds with the following characteristics:

Face Value $20,000,000

Coupon rate 3%

Yield to maturity 3.2%

Maturity December 31, 20x15

Coupon payment dates Jun 30, Dec 31

Bond issue costs $360,000

Required -

a) Write the journal entries for this bond for the years 20x0 and 20x1.

b) Assume that on January 1, 20x9, 10% of the bond issue is retired at 98. Write the

journal entry to show the bond retirement and write the journal entry to record the

interest payment at June 30, 20x9.

c) On July 1, 20x11, the remaining bonds are repurchased at 101. Write the journal

entry to show the bond retirement

Question 2) On January 31, 20x1, an entity issues bonds with the following characteristics:

Face Value $20,000,000

Coupon rate 5%

Yield to maturity 4.6%

Bonds dated December 31, 20x0

Maturity December 31, 20x20

Coupon payment dates Jun 30, Dec 31

Required -

Write the journal entries for this bond for the year 20x1.