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How do i do this question? On July 1, 2016 Balloon Co....

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Accounting

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On July 1, 2016 Balloon Co. issued $500,000,8-year bonds for a price of 94 . Because interest rates have dropped so dramatically over the past several years, Balloon called in these bonds on October 1, 2022 for a price of 103.5 . Balloon prepares financial statements in accordance with ASPE and the company uses the straight-line method to amortize any premium or discount. Required: 1. Compute the carrying value of the bond on October 1, 2022. 2. Prepare the journal entry on October 1, 2022 (ignore interest)

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