Glover Corporation issued $3.5 million of 6%, 5-year bonds on January 1, 2024. The bonds were dated January 1 and pay interest annually. Glover has a December 31 year end. The bonds are secured with real estate holdings. The market interest rate was 7% for these bonds. 

Instructions 

a. Calculate the price of the bonds and record the bond issue. 

b. Prepare an effective-interest amortization table for these bonds. Round amounts to the nearest dollar. 

c. Journalize the first three payments assuming reversing entries have been used.

Why would a bondholder request security for the bond?