Question

On January 1st, 2013, Shay issues $700,000 of 10%, 15-year bonds at a price of 97.75....

On January 1st, 2013, Shay issues $700,000 of 10%, 15-year bonds at a price of 97.75. Six years later, on January 1st, 2019, Shay retires 20% of these bonds by buying them on the open market at 104.50. All interest is accounted for and paid through December 31st, 2018, the day before the purchase. The straight-line method is used to amortize any bond discount

1) How much does the company receive when it issues the bonds on January 1st, 2013?

2) How much amortization of the discount is recorded on the bonds for the entire period from January 1st, 2013 through December 31st, 2018?

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