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  3. 1. fast tires issued $5,000,000 of five-year, 10%

1. Fast Tires issued $5,000,000 of five-year, 10% bonds on June 30, 20Y5, for $5,405,550....

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Accounting

1. Fast Tires issued $5,000,000 of five-year, 10% bonds on June 30, 20Y5, for $5,405,550. The bonds pay interest quarterly, beginning September 30, 20Y5. At the date of issuance, the market rate was 8%. Calculate the interest expense and bond amortization for the first fiscal year using the: A.Straight-line method for amortization B. Effective interest rate method for amortization Use the information above to prepare the journal entries to record -the issuance -first interest payment -retirement of the bonds for Fast Tires. Assume the company uses the straight-line method for amortization.

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