Question: Please show full steps and how you did it. Ashraf Limited sold on June 30, year 1, $4,000,000, 20-year bonds, paying a nominal interest rate

Please show full steps and how you did it.

Ashraf Limited sold on June 30, year 1, $4,000,000, 20-year bonds, paying a nominal interest rate of 6.5%. The bonds were issued at 105.7344 percent with a yield of 6%. The bonds pay annual interest on June 30. The company uses the effective rate interest method and its fiscal year ends on December 31.

1. Prepare the journal entry to record the interest payment on June 30, year 2.

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