Hillside issues $4,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $3,456,448.

Required

1. Prepare the January 1 journal entry to record the bonds’ issuance.

2. For each semiannual period, compute

(a) The cash payment,

(b) The straight-line discount amortization,

(c) The bond interest expense.

3. Determine the total bond interest expense to be recognized over the bonds’ life.

4. Prepare the first two years of a straight-line amortization table like Exhibit 14.7.

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