Question

Stower's Research issues bonds dated Jan.1,2005 that pay interest semiannually on June 30and Dec.31. The bonds have a $20,000 par value, an annual contract rate of 10% and mature in 10 years. For each of the following, determine the bonds price on Jan. 1, 2005 and prepare the journal entry to record their issuance: 1) market rate at date of issuance of 8%,10%and 12%. Please help.