Rogers Communications Inc. is a diversified Canadian communications and media company engaged in wireless, cable, and media communications. On March 15, 2013, Rogers sold notes with the following specifications:

Required:
1. Prepare a journal entry to record the sale of these notes on March 15, 2013.
2. Prepare the journal entry to record the payment of interest and amortization of the discount on September 15, 2013. The company uses the effective- interest method of amortization.
3. Compute the interest expense that accrued from September 15, 2013, to December 31, 2013, the end of Rogers€™ fiscal year, and prepare the adjusting journal entry on December 31, 2013, to record interest expense and amortization of the discount on the notes.
4. Show the amounts that should be reported on Rogers€™ financial statements for 2013.
5. Compute the total amount of interest expense over the life of the notes.
6. After looking at the issue price, a student asked why Rogers did not simply sell the notes at 100 percent of the principal amount instead of selling them at a discount. How would you respond to this question?

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Principal amount Maturity date Issue price Coupon rate Effective interest rate Interest payment dates $500 milion March 15, 2023 99.845% of principal amount 3.00% 3.018% March 15 and September 15