E$14\mathrm{.}14($LO $2)($Determination of Proper Amounts in Account Balances$)$ Four independent situations follow.

Wen Corporation incurred the following costs when it issued bonds: printing and engraving costs, $$25,000$; legal fees, $$69,000$; and commissions paid to underwriter, $$70,000.$

Griffith Inc. sold $$3$ million of $10-$year, $10\%$ bonds at $104$ on January $1,2023.$ The bonds were dated January $1,2023,$ and pay interest on July $1$ and January $1.$

Kennedy Inc. issued $$600,000$ of $10-$year, $9\%$ bonds on June $30,2023,$ for $$562,613.$ This price provided a yield of $10\%$ on the bonds. Interest is payable semi$-$annually on December $31$ and June $30.$

Bergevin Corporation issued $$800,000$ of bonds on January $1,2023,$ with interest payable each January $1.$ The bonds$$ carrying amount on December $31,2023,$ is $$850,716\mathrm{.}97.$ Bergevin has chosen to apply the fair value option in accounting for the bonds. An assessment of the company$$s credit risk at December $31,2023,$ shows that it has increased. As a result, the bonds$$ fair value is $$838,000$ on that date. Bergevin prepares financial statements in accordance with IFRS.

Instructions

In situation $1,$ what accounting treatment could be given to these costs?

In situation $2,$ if Griffith follows ASPE and uses the straight$-$line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July $1,2023,$ and December $31,2023.$

In situation $3,$ if Kennedy uses the effective interest method, determine the amount of interest expense to record if financial statements are issued on October $31,2023.$

In situation $4,$ what accounting treatment should be given to the bonds at December $31,2023?$

Prepare the journal entry to revalue the bonds under the fair value option for situation $4$ under $(1)$ IFRS and $(2)$ ASPE. Round to the nearest dollar.