National Orthopedics Co. issued 8% bonds, dated January 1, with a face amount of $700,000 on January 1, 2016. The bonds mature on December 31, 2019 (4 years). For bonds of similar risk and maturity the market yield was 10%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1
Prepare the journal entry to record their issuance by National on January 1, 2016
Prepare an amortization schedule that determines interest at the effective rate each period.
Prepare the journal entry to record interest on June 30, 2016
Prepare the appropriate journal entries at maturity on December 31, 2019.