On January 1, 2011, Gray Company issued $500,000 of 5-year, 3% bonds for $470,000, their interest payable

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Question:

On January 1, 2011, Gray Company issued $500,000 of 5-year, 3% bonds for $470,000, their interest payable semiannually every June 30 and December 31. Gray uses straight-line amortization, having judged the difference under the effective-interest method to be immaterial.

Scenario #1

On April 30, 2015, Gray retired all of the bonds at 101. Prepare the bond-related journal entry(s) Gray should have made on April 30, 2015.

Scenario #2

On April 30th 2015, Gray retired $100,000 of the bonds at 98. Prepare the bond-related journal entry(s) Gray should have made on (1) April 30, 2015, and (2) June 30, 2015, and the display of the bonds as they should appear in Gray's mid-year balance sheet.