On June 30 2006 Athens Company issued 1 500 000 of 10 year
On June 30, 2006, Athens Company issued $1,500,000 of 10-year, 8% bonds, dated June 30, for $1,540,000. The bonds were purchased by Palermo Co. on the issue date at the issue price. Present entries to record the following transactions:
(a) Athens Company
(l) Issuance of bonds.
(2) Payment of first semiannual interest on December 31, 2006.
(3) Amortization by straight-line method of bond premium on December 31, 2006.
(b) Palermo Company
(1) Purchase of bonds.
(2) Receipt of first semiannual interest amount on December 31, 2006.
(3) Amortization by straight-line method of bond premium on December 31, 2006.

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