Assume that the bonds in BE14.15 were issued for $644,632 and the effective interest rate was 6%.

(a) Prepare Quinton Corporation's journal entry for the January 1 issuance.

(b) Prepare the company's journal entry for the July 1 interest payment.

(c) Prepare the company's December 31 adjusting entry.

(d) Assume that the effective interest of 6% was not given in the data. Prove the effective interest rate of 6% using (1) a financial calculator or (2) Excel function Rate.

(e) Prepare the first three payments of an effective interest amortization table for the bonds. Round to the nearest cent for the amortization table. 

Data From BE14.15

On January 1, 2020, Quinton Corporation issued $600,000 of 7% bonds that are due in 10 years. The bonds were issued for $559,229 and pay interest each July 1 and January 1. The company uses the effective interest method. Assume an effective rate of 8%.