Accrued Interest

On May 1, the Garnett Corporation wanted to purchase a $570,000 piece of equipment, but Garnett was only able to furnish $79,800 of its own cash to purchase the equipment. Garnett borrowed the remainder of the $570,000 from the People's National Bank on a 3-year, 6.5% note.

Required:

If the company keeps its records on a calendar year, what adjusting entry should Garnett make on December 31? Round amounts to the nearest dollar.

Interest expense= ?

Interest Payable= ?