On October 1, 2015, Port Company issued 11%, 10-year, $800,000 bonds at 108. Interest dates are April 1 and October 1. The amount of straight-line amortization for 2015 is:

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The bond premium is $64,000 ($800,000 x 8%). The straight-line amortization for one year is $6,400 ($64,000 / 10 years). Since the bonds were issued on October 1, 2015, only three months of amortization is needed for 2015, which is $1,600 ($6,400 / 12 months x 3 months).

On October 1, 2015, Port Company Issued 11%, 10-Year, $800,000