On January 1, 2009, the Baker Corporation issued $100,000 of five year bonds due December 31, 2013, for $103,604.79 less bond issue costs of $3,000. The bonds carry a face rate of interest of 13% payable annually on December 31 and were issued to yield 12%. The company uses the effective interest method of amortization.
Required:
Prepare the journal entries to record the issuance of the bonds, all the interest payments, premium amortizations, bond issue cost amortizations, and the repayment of the bonds.