On January 1, 2020, Harrington Corporation sold $425,000 of 15-year, 11% bonds. The bonds sold for $395,000 and pay interest semiannually on June 30 and December 31.
Required:
1. Prepare the journal entry to record the sale of the bonds.
2. Calculate the amount of the semiannual interest payment.
3. Prepare the entry at June 30, 2020, to recognize the payment of interest and interest expense.
4. Calculate the annual interest expense for 2020.