First Place Sports Ltd. is authorized to issue $1,000,000 of 9%, 10-year bonds payable. On December 31, 2010, when the market interest rate is 10%, the company issues $800,000 of the bonds and receives cash of $750,232. First Place Sports amortizes bonds by the effective-interest method. The semiannual interest dates are June 30 and December 31.

Requirements

1. Prepare a bond amortization table for the first four semiannual interest periods.

2. Record issuance of the bonds payable on December 31, 2010, the first semiannual interest payment on June 30, 2011, and the second payment on December 31, 2011.