Consider your answers from Requirements 1–3 of Exercise. Journalize issuance of the bond and the first semiannual interest payment under each of the three assumptions in Exercise. The company amortizes bond premium and discount by the effective- interest amortization method. Explanations are not required.
1. Determine the present value of seven-year bonds payable with face value of $ 91,000 and stated interest rate of 14%, paid semiannually. The market rate of interest is 14% at issuance.
2. Same bonds payable as in Requirement 1, but the market interest rate is 16%.
3. Same bonds payable as in Requirement 1, but the market interest rate is 12%.