TeslaShock Corporation manufactures electrical test equipment. The company's board of directors authorized a bond issue on January 1 of this year with the following terms: (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the appropriate factor(s) from the tables provided.)

Face (par) value: $807,500

Coupon rate: 8 percent payable each December 31

Maturity date: December 31, end of Year 5

Annual market interest rate at issuance: 12 percent

1. Compute the bond issue price.

2. Assume that the company used the straight-line amortization method. Compute the following for Year 1 through Year 5: (Round your final answers to nearest whole dollar amount.)

cash payment for bond interest

amortization of bond discount or premium

bond interest expense

3. Assume that the company used the effective-interest amortization method. Compute the following for Year 1 through Year 5: (Round your final answers to nearest whole dollar amount.)

Cash payment for bond interest.

Bond interest expense.

Amortization of discount

Net liability