III. Chapter 10 Liabilities 1. Sikma Company issued $600,000,10-year, 5 percent bonds on January 1, 2021. The bonds were issued for $580,000. Interest is payable annually on December 31 . Using straight-line amortization, prepare journal entries to record (a) the bond issuance on January 1,2021, and (b) the payment of interest on December 31, 2021. 2. What is the par value of a bond? 3. Why do bonds sell at a premium or at a discount? 4. How is the value of a bond issue determined? (What formulas are used?) 5. What is accrued interest? 6. What does it mean if a bond sold for "96" or at "102?" 7. What is the total interest cost for a $10,000,10-year bond issue, which pays 10% and was sold at "98?" 8. What is the carrying value of bonds? On which financial statement would the issuance of bonds be found? 9. What is "discount?" What is "premium?" 10. Why do we amortize discount or premium and what journal entries are needed