214-15 (Entries for Retirement and Issuance of Bonds ) On June 50,2002, Mendenhal Company issued 670 Do105with a par value of $600,000 due in 20 years. They were issued at 82.8414 to yield 10% and were callable at 104 atany date after June 30, 2010. Because of lower interest rates and a significant change in the company's credit ratingit was decided to call the entire issue on June 30, 2011, and to issue new bonds. New 6% bonds were sold in theamount of $800,000 at 112.5513 to yield 5%; they mature in 20 years. Interest payment dates are December 31 andJune 30 for both old and new bonds.Instructions(a) Prepare journal entries to record the retirement of the old issue and the sale of the new issue on June 30, 2011.Unamortized discount is $78,979.(b) Prepare the entry required on December 31, 2011, to record the payment of the first 6 months' interest and theamortization of premium on the bonds.