Bosekit Corp. is planning to issue bonds with a face value of $600,000 and a coupon rate of 5 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31. All of the bonds will be sold on January 1 of this year.
1) Compute the issue (sale) price on January 1 of this year for each of the following independent cases (show computations):
A: Market interest rate (annual): 4.5 percent.
B: Market interest rate (annual): 5 percent.
C: Market interest rate (annual): 5.5 percent.
2) show all related journal entries for the first year.
