On June 30, 2000, Organ Company issued 12% bonds with a face value of 1,000,000 due in 10 year. They were issued at 96 and were callable at 103 at any date after June 30, 2005. Because of lower interest rates and a significant change in the company's credit rating, it was decided to call the entire issue on June 30, 2007, and to issue new bonds. New 10% bonds were sold in the amount of 2,000,000 at 102; they mature in 15 year. Organ Company uses straight-line amortization. Interest payment dates are June 30 and December 31.