Question: Please do not answer in hand writing On January 1, 2021, Plains, Inc. issues $2,700,000 in 10-year bonds that pay 7%, while bonds of similar

Please do not answer in hand writing

On January 1, 2021, Plains, Inc. issues $2,700,000 in 10-year bonds that pay 7%, while bonds of similar risk and maturity are paying 8%.They pay interestsemi-annuallyon June 30^thand December 31^st.They use the effective interest method to calculate interest expense.

SHOW YOUR WORK.Include calculations, rates, and factors.

REQUIREMENT 1 (7 points):

Provide the number of compounding periods for the bonds___________________

Provide the market interest rate per compounding period___________________________

Provide the amount of cash paid for each semi-annual interest payment____________________

Provide the total cash received at issuance for the bonds_____________________

Was this bond issued at a discount or a premium?_____________________

REQUIREMENT 2 (3 points):

Prepare the journal entry to record issuance of the bonds on January 1, 2021 by Plains, Inc.:

REQUIREMENT 3 (3 points):

Prepare the journal entry to record the interest payment on June 30, 2021 by Plains, Inc.:

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