Compute the cash payment, Financial Accounting

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Heathrow issues $2,000,000 of 6%, 15-year bonds dated January 1, 2011, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $2,447,990.

Required:

1. Prepare the January 1, 2011, journal entry to record the bonds' issuance.

 

2(a) For every semiannual period, compute the cash payment.

 

2(b) For every semiannual period, compute the the straight-line premium amortization.

 


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