Exercise $14-9($Static$)$ Issuance of bonds; effective interest; amortization schedule; financial statement

effects $[$L$014-2]$

When Patey Pontoons issued $6\%$ bonds on January $1,2024,$ with a face amount of $$600,000,$ the market yield for bonds of similar risk

and maturity was $7\%.$ The bonds mature December $31,2027(4$ years$).$ Interest is paid semiannually on June $30$ and December $31.$

Required:

Determine the price of the bonds at January $1,2024.$

Prepare the journal entry to record their issuance by Patey on January $1,2024.$

Prepare an amortization schedule that determines interest at the effective rate each period.

Prepare the journal entry to record interest on June $30,2024.$

What is the amount related to the bonds that Patey will report in its balance sheet at December $31,2024?$

What is the amount related to the bonds that Patey will report in its income statement for the year ended December $31,2024?$

$($Ignore income taxes.$)$

Prepare the appropriate journal entries at maturity on December $31,2027.$

Note: Use tables, Excel, or a financial calculator. $($FV of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $$1)$

Complete this question by entering your answers in the tabs below.

Req $1$

Req $2$

Req $3$

Req $4$

Req $5$ and $6$

Req $7$

Prepare an amortization schedule that determines interest at the effective rate each period.

Note: Round intermediate calculations and final answers to the nearest whole dollar.