On January 1, 2013, Loop de Loop Raceway issued 620 bonds, each with a face value of $1,000, a stated interest rate of 7 percent paid annually on December 31, and a maturity date of December 31, 2015. On the issue date, the market interest rate was 8 percent, so the total proceeds from the bond issue were $604,002. Loop de Loop uses the straight-line bond amortization method.

Required:

1-a. Prepare a bond amortization schedule.

1-b. Prepare the journal entry to record the bond issue. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1-c. Prepare the journal entries to record the interest payments on December 31, 2013 and 2014. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Changes During the Period Ending Bond Liability Balances Discount on Discount Amortized Interest Bonds Carrying Value Period Ended Cash Paid Bonds Expense Payable Payable 01/01/13 12/31/13 12/31/14 12/31/15