On June 1, 2019, Whispering Company sold $2,940,000 in long-termbonds for $2,578,700. The bonds will mature in 10 years and have astated interest rate of 8% and a yield rate of 10%. The bonds payinterest annually on May 31 of each year.
The bonds are to be accounted for under the effective-interestmethod.
1)Construct a bond amortization table for this problem toindicate the amount of interest expense and discount amortizationat each May 31.
2)Assuming that interest and discount amortization are recordedeach May 31, prepare the adjusting entry to be made on December 31,2021. (Credit account titles are automatically indentedwhen the amount is entered. Do not indent manually. If no entry isrequired, select "No Entry" for the account titles and enter 0 forthe amounts.)
