Answers:

(a)
PV of face value (4m x 0.6756) 2,702,400
Present value of interest payments (200k x 8.1109) 1,622,180
Issue price 4,324,580

(b)
Ammortization Table
Date Interest Paid Interest Expense Premium Ammortization Ammortized Cost, End
03/01/20 - - - 4,324,580
8/31/20 200,000 172,983 27,017 4,297,563
2/28/21 200,000 171,903 28,097 4,269,466
8/31/21 200,000 170,779 29,221 4,240,244

(c )
2020
Mar. 1 Cash 4,324,580
Bond Payble 4,000,000
Premium on Bonds Payable 324,580

Aug. 31 Interest Expene 172,983

Premium on Bonds Payable 27,017
Cash 200,000

Dec. 31 Interest Expense (171,903 x4/6) 114,602

Premium on Bonds Payable 18,731
Interest Payable (200k x 4/6) 133,333

2021
Feb. 28 Interest Expense (171,903 x 2/6) 57,301
Premium on Bonds Payable (28,097 x 2/6) 9,366
Intrest payable 133,333
Cash 200,000