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Park Corporation is planning to issue bonds with a face value of $2,400,000 and a coupon rate of 9 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31. All of the bonds were sold on January 1 of this year. Park uses the effective-interest amortization method and also uses a premium account. Assume an annual market rate of interest of 7.5 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1)

Note: Use appropriate factor(s) from the tables provided.

Required:

1. and 2. Prepare the journal entry to record the issuance of the bonds and the interest payment on June 30 of this year

1. Prepare the journal entry to record the issuance of the bonds and the interest payment on June 30 of this year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate calculations and final answers to whole dollars.

Journal entry worksheet

Record the issuance of the bonds.

Note: Enter debits before credits.

	Date General Journal Debit Credit January 01

2. Prepare the journal entry to record the issuance of the bonds and the interest payment on June 30 of this year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate calculations and final answers to whole dollars.

Journal entry worksheet

Record the payment of interest on June 30 using the effective-interest amortization method.

Note: Enter debits before credits.

	Date General Journal Debit Credit June 30

3. What bonds payable amount will Park report on its June 30 balance sheet?

What bonds payable amount will Park report on its June 30 balance sheet? Note: Round your intermediate calculations and final answers to whole dollars.

	PARK CORPORATION Balance Sheet (Partial) At June 30 Long-term liabilities ______ _______ $0

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