Question - On July 1, 1999, The Fish Co issued $8,500,000 of 10 year, 12% bonds when the market rate of interest was 14%. Interest on the bonds is paid semi-annually on December 31 and June 30. Instructions:
1. Calculate NPV of the bond and Journalize the entry to record the amount of cash proceeds from the sale of the bonds. Use the Present Value tables at the back of your book in Appendix A.
2. Journalize the entry to record the first semi-annual interest payment and the amortization for the bond discount/premium.
3. Repeat instructions 1-2 using a market rate of interest of 10%.