On June $1,2018,$ the Rauch Corp. acquired $$300,000$ in $10\%,20-$year bonds at $96\mathrm{.}192.$ Acquisition costs of

$$700$ were incurred on this purchase. These bonds, which were dated April $1,2018,$ pay interest semi$-$

annually on April $1$ and October $1$ of each year. Any discount or premium on this bond investment is

amortized using the straight$-$line method. This amortization is recorded once a year at year$-$end, if

possible. On August $1,2020,$ Rauch sold one$-$half of this investment at $101.$

Required:

a$.$ Assuming this investment is classified as current and categorized as "available for sale":

i$.$ Record the June $1,2018,$ acquisition.

ii$.$ Make the necessary October $1,2018,$ entry to record the receipt of the first interest

payment.

iii. Make the necessary December $31,2018,$ adjusting entry$($ies$)$ related to this bond issue.

iv$.$ Make the necessary April $1,2019,$ entry to record the receipt of the second interest

payment.

v$.$ Record the sale of part of this investment on August $1,2020.$

b$.$ Assuming these bonds were acquired on April $1,2018,$ instead of June $1,2018,$ determine the

market interest rate on these bonds on the day they were acquired using the IRR function in Excel.