Gallatin Corp. issued 30,000,000 of five-year, 15% bonds at an effective interest rate of 13% with interst payable semiannually, receiving cash of $32,156,768.
1. Determine the amount of premium to be amortized for the first semiannual interest payment period, using the interest method.
2. Determine the amount of premium to be amortized for the second semiannual interest payment period, using the interest method.
3. Determine the amount of bond interest expense for the first year.