Question: Ripkin Company issues 9%, five-year bonds dated January 1, 2017, with a $320,000 par value. The bonds pay interest on June 30 and December 31

Ripkin Company issues 9%, five-year bonds dated January 1, 2017, with a $320,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $332,988. Their annual market rate is 8% on the issue date.

Required

1. Calculate the total bond interest expense over the bonds' life.

2. Prepare a straight-line amortization table like Exhibit 14.11 for the bonds' life.

3. Prepare the journal entries to record the first two interest payments.

Exhibit 14.11

Semiannual Unamortized Carrying Premium Period-End Value (0) 12/31/2017 .... $3,546 $103,546 2,659 102,659 (1) 6/30/2018

Semiannual Unamortized Carrying Premium Period-End Value (0) 12/31/2017 .... $3,546 $103,546 2,659 102,659 (1) 6/30/2018 .... (2) 12/31/2018 1,772 101,772 (3) 6/30/2019 885 100,885 (4) 12/31/2019 100,000

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