Solve part b and EXPLAIN your work.

Golden Inc. issues $4.00 million, 5-year, 12% bonds at 103, with interest payable on July 1 and January 1. The straight-line method is used to amortize bond premium. (a) Your answer is correct. Prepare the journal entry to record the sale of these bonds on January 1, 2015. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit January Cash 4120000 Bonds Payable 4000000 Premium on Bonds Pay 120000