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# Question 1 (22 marks) Ivanhoe Corporation issued \$3.12 million of 7-year, 3% bonds dated January 1,...

Question 1 Ivanhoe Corporation issued \$3.12 million of 7-year, 3% bonds dated January 1, 2021 for \$2,755,244. The market interest rate when the bonds were issued was 5%. Interest is payable semi-annually on January 1 and July 1. Ivanhoe has a December 31 year-end. Were the bonds issued at a premium or a discount? Why? Prepare an amortization schedule for the first three interest payments. Prepare the journal entry to record the first interest payment on July 1, 2021. Prepare the journal entry to accrue interest expense on December 31, 2021. Prepare the journal entry to record the second interest payment on January 1, 2022. SHOW ALL CALCULATIONS! Plz answer Asap

 Bond is issued at Discount because , Bond of \$3120000 , issued on \$2755244 which is less than par Value
 Bond Amortization Schedule- Ivan hoe Corporation Year Cash Interest (1000000*1.5%) Interest expense (2.5%) Amortized Discount Carrying Value Issue date 2,755,244 30/06/2021 46,800 68,881.10 22,081 2,733,163 31/12/2021 46,800 68,329.07 21,529 2,711,634 30/06/2022 46,800 67,790.85 20,991 2,690,643
 Date Account Tittle Debit Credit 1-Jan-21 Cash \$2,755,244.00 Discount on Bond Payable \$364,756.00 Bond Payable \$3,120,000.00 1-Jul-21 Interest Expense \$68,881.10 Discount on Bond Payable \$22,081.10 Cash \$46,800.00 31-Dec-21 Interest Expense \$68,329.07 Discount on Bond Payable \$21,529.07 Interest Payable \$46,800.00

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