Show all steps for all calculations.

3. Barber Company issued $500,000, 6% bonds on January 1, 2018, to yield 8% per year. The bonds would be outstanding for 10 years from the issuance date, and pay interest semi-annually on July 1 and January 1.

a) How much was raised by Barber from the bond issue? (Use present value factors from the attached tables for calculations.

b) Prepare an amortization table using the effective-interest method of amortization. Complete the first five payments only.

c) Prepare journal entries for 2018 and 2019, using the effective-interest method. Barber has a December 31 fiscal year-end.

d) Prepare journal entries for 2018, using the effective-interest method. Assume Barber has a August 31 fiscal year-end.

e) Assume that 40% of the bonds were bought back on the open market on September 1, 2019 at 97 plus accrued interest. Record journal entries for the bond buy-back.