P11A-4A Calculating and recording bonds when stated rate and market rate are

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P11A-4A Calculating and recording bonds when stated rate and market rate are
different [15–20 min]

TVX issued $800,000 of 5%, 10-year bonds payable at a price of 92.595 on
March 31, 2012. The market interest rate at the date of issuance was 6%, and the
bonds pay interest semiannually.

Requirements

1. How much cash did the company receive upon issuance of the bonds payable?

2. Prepare an effective-interest amortization table for the bond discount through
the first two interest payments. Use Exhibit 11A-1 as a guide, and round
amounts to the nearest dollar.

3. Journalize the issuance of the bonds on March 31, 2012, and on September 30,
2012, payment of the first semiannual interest a