WP14-34A (similar to) Question Help On January 1, 2018, Agricultural Credit Union (ACU) issued 6%, 20-year bonds payable with face value of $650,000. The bonds pay interest on June 30 and December 31. Read the requirements. Requirement 1. If the market interest rate is 5% when ACU issues its bonds, will the bonds be priced at face value, at a premium, or at a discount? Explain. The 6% bonds issued when the market interest rate is 5% will be priced at a premium . They are attractive in this market, so investors will pay more than face value to acquire them. Requirement 2. If the market interest rate is 7% when ACU issues its bonds, will the bonds be priced at face value, at a premium, or at a discount? Explain. The 6% bonds issued when the market interest rate is 7% will be priced at a discount . They are unattractive in this market, so investors will pay less than face value to acquire them. Requirement 3. The issue price of the bonds is 99. Joumalize the bond transactions, (Assume bonds payable are amortized using the straight-line amortization method. Record debits first, then credits. Select explanations on the last line of the journal entry. Round your answers to the nearest whole dollar.) a. Journalize the issuance of the bonds on January 1, 2018 Date Accounts and Explanation Debit Credit 2018 Jan. 1 Cash 643,500 6,500 Discount on Bonds Payable Bonds Payable 650,000 Choose from any list or enter any number in the input fields and then click Check Answer. ? W P14-34A (similar to) Question Help On January 2018, Agricultural Credit Union (ACU) issued 6%, 20-year bonds payable with face value of $650,000. The bonds pay interest on June 30 and December 31. Read the requirements 2018 Jan, 1 Cash 643,500 6,500 Discount on Bonds Payable Bonds Payable 650,000 Issued bonds at a discount. b. Journalize the payment of interest and amortization on June 30, 2018 Date Accounts and Explanation Debit Credit 2018 Jun. 30 Choose from any list or enter any number in the input fields and then click Check Answer. ? W P14-34A (similar to) Question Help On January 1, 2018, Agricultural Credit Union (ACU) issued 6%, 20-year bonds payable with face value of $650,000. The bonds pay interest on June 30 and December 31. Read the requirements. Requirement 1. If the market interest rate is 5% when Requirements The 6% bonds issued when the market interest rate is Je to acquire them. Requirement 2. If the market interest rate is 7% when A The 6% bonds issued when the market interest rate is to acquire them. Record debits first, then credits. Select explanations Requirement 3. The issue price of the bonds is 99. Jou on the last line of the journal entry. Round your answers If the market interest rate is 5% when ACU issues its bonds, will the bonds be priced at face value, at a premium, or at a discount? Explain. 2. If the market interest rate is 7% when ACU issues its bonds, will the bonds be priced at face value, at a premium, or at a discount? Explain. 3. The issue price of the bonds is 99. Joumalize the following bond transactions: Issuance of the bonds on January 1, 2018. Payment of interest and amortization on June 30, 2018. C. Payment of interest and amortization on December 31, 2018. d. Retirement of the bond at maturity on December 31, 2037, assuming the last interest payment has already been recorded. a. Journalize the issuance of the bonds on January 1, 2 a. b. Date Accounts and Explanation 2018 Jan. 1 Cash Discount on Bonds Payable Bonds Payable Print Done Choose from any list or enter any number in the input fields and then click Check