Question

Hillside issues $2,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $1,728,224.

Required:
1. Prepare the January 1 journal entry to record the bonds’ issuance.
2(a) For each semiannual period, complete the table below to calculate the cash payment.
2(b) For each semiannual period, complete the table below to calculate the straight-line discount amortization.
2(c) For each semiannual period, complete the table below to calculate the bond interest expense.
3. Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.
4. Prepare the first two years of a straight-line amortization table.
5. Prepare the journal entries to record the first two interest payments.

Juurlidl eritry Workstieel Record the issue of bonds with a par value of $2,000,000 cash on January 1, 2019 at an issue price of $1,728,224. Note: Enter debits before credits. Date General Journal Debit Credit January 01

Please answer in this format please!

Answer 1

Journal entry
Date	General Journal				Debit	Credit
1/1/2019	Cash				1,728,224
	discount on bonds				271,776
	bonds payable					2,000,000
2-a)	par maturity value			Annual rate	/	year	semi annual cash payment
	2,000,000		*	6%		6./12	60000
							semi annual		Straight line
2-b)	par value		bonds price		Discount		periods		disc amortization
	2,000,000	-	1,728,224	=	271,776	/	30	=	9059
2-c)	Semi annual cash			Discount		bond interest expense
	payment			amortization
	60,000		+	9059	=	69,059
3)	total bond interest expense over life of bonds
	amount repaid
	30	payments of		60,000	1800000
		par value ant maturity			2,000,000
	total repaid				3800000
	less amount borrowed				1,728,224
	total bond interest expense.				2,071,776
4)		unamort	Carrying
	period	discount	value
	1/1/2019	271,776	1,728,224
	6/30/2019	262,717	1,737,283
	12/31/2019	253,658	1,746,342
	6/30/2020	244,598	1,755,402
	12/31/2020	235,539	1,764,461
5)
Date	General Journal				Debit	Credit
6/30/2019	interest expense				69,059
	Discount on bonds payable					9,059
	cash					60,000
31/12/2019
	interest expense				69,059
	discount on bonds payable					9,059
	cash					60,000