On July 1, 2010, Atwater Corporation issued $1,681,700 face value, 9%, 10-year bonds at $1,920,720. This price resulted in an effective-interest rate of 7% on the bonds. Atwater uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest July 1 and January 1.
Instructions
(Round all computations to 0 decimal places, e.g. 125. Use rounded amounts for future computations.)
Prepare the journal entry to record the issuance of the bonds on July 1, 2010. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2.)