3On February 1, 2021, Strauss-Lombardi issued 9% bonds, dated February 1, with a face amount of $800,000. Thebonds sold for $731,364 and mature on January 31, 2041 (20 years). The market yield for bonds of similar riskand maturity was 10%. Interest is paid semiannually on July 31 and January 31. Strauss-Lombardis fiscal yearends December 31.

Required:

1. Prepare the journal entry to record their issuance by Strauss-Lombardi on February 1, 2021.

2. Prepare the journal entry to record interest on July 31, 2021 (at the effective rate).

3. Prepare the adjusting entry to accrue interest on December 31, 2021.