A company issued 10%, 10-year bonds with a par value of $1,000,000 on January 1, at a selling price of $885,295 when the annual market interest rate was 12%. The company uses the effective interest amortization method. Interest is paid semiannually each June 30 and December 31.
(1) Prepare an amortization table for the first two payment periods using the format shown below: 
(2) Prepare the journal entry to record the first semiannual interest payment.
Definitions:
Proposed Project
A structured series of related activities scheduled for completion within a set period, while staying within defined budgetary and other restrictions.
Final Cash Flow
The last payment received from an investment, including the return of principal plus any final interest or dividend payments.
Inventory
The items and substances that a company possesses with the ultimate aim of selling them or using them in manufacturing.
Interest Expense
Interest expense is the cost incurred by an entity for borrowed funds, which can include interest on bonds, loans, convertible debt, and lines of credit.
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