16. value: 3.33 points On January 1, a company issues bonds dated January 1 with a par value of $350,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $335,819. The journal entry to record the first interest payment using the effective interest method of amortization is: O Debit Interest Expense $13,432.76; credit Premium on Bonds Payable $1,182.76; credit Cash $12,250.00. O Debit Interest Expense $13,432.76; credit Discount on Bonds Payable $1,182.76; credit Cash $12,250.00. O Debit Interest Expense $11,067.24; debit Premium on Bonds Payable $1,182.76; credit Cash $12,250.00. O Debit Interest Expense $11,067.24; debit Discount on Bonds Payable $1,182.76; credit Cash $12,250.00. O Debit Interest Payable $12,250.00; credit Cash $12,250.00