2. Kiki Inc., which closes its books on December 31, is authorized to issue $600,000 of 8%, 12- year bonds dated January 1, 2016 with interest payments on January 1. REQUIRED: Present general journal entries to record the events listed below, assuming the bonds were sold at face on January 1, 2016. 1. The bond issue. 2. Accrual of the bond interest at December 31, 2016 3. Payment of the first annual period's interest, January 1, 2017 4. Retirement of the bond issue at maturity 3. Tadki Airlines is considering two alteratives for financing of a purchase of a fleet of airplanes. There are two alternatives: 1. Issue 60,000shares of of common stock at $45 per share (no cash dividends are or will be involved). 2. Issue 10%, 10 year bonds at face value for $2,700,000. It is estimated the company will eam $800,000 before interest and taxes as a result of this purchase. The company has an estimated tax rate of 30% and has 90,000shares of common stock outstanding prior to the new financing. REQUIRED: Determine the effect on net income and earnings per share for these two methods of financing.