Question: San Mateo Company issues 7%, five-year bonds dated January 1, 2009, with a $220,000 par value. The bonds pay interest on June 30 and December

San Mateo Company issues 7%, five-year bonds dated January 1, 2009, with a $220,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $229,385. Their annual market rate is 6% 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 for the bonds’ life.
3. Prepare the journal entries to record the first two interest payments.

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Part 1 Ten payments of 7700 77000 Par value at maturity 220000 Total repaid 297000 Less amoun... View full answer

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