Ike issues $110,000 of 9%, three-year bonds dated January 1, 2017, that pay interest semiannually on June 30 and December 31. They are issued at $112,881. Their market rate is 8% at the issue date.

Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.

	Total bond interest expense over life of bonds: Amount repaid: payments of Par value at maturity Total repaid 0 Less amount borrowed Total bond interest expense $0

Prepare an effective interest amortization table for the bonds' first two years.

	Semiannual Interest Period-End Cash Interest Paid Bond Interest Expense Premium Amortization Unamortized Premium Carrying Value 01/01/2017 06/30/2017 12/31/2017 06/30/2018 12/31/2018

Prepare the journal entries to record the first two interest payments.

Record the first interest payment on June 30, 2017.

Note: Enter debits before credits.

	Date General Journal Debit Credit Jun 30, 2017

Record the second interest payment on December 31, 2017.

Note: Enter debits before credits.

	Date General Journal Debit Credit Dec 31, 2017 Prepare the journal entry to record the bonds' retirement on January 1, 2019, at 98. Record the retirement of the bonds on January 1, 2019 at 98. Note: Enter debits before credits. Date General Journal Debit Credit Jan 01, 2019