and January 1. The Cakery has a December 31 yow and. The adjusting entry for interest on December 31, 2020 would On January 1, 2020, the Cakery issued at a bond a discount. It pays interessemiannually on Include - debit to Interest Expense, a debit to Discount on Bonds Payable, and a credit to interest Payable -debit to interest Expense, a credit to Discount on Bonds Payable, and a credit to interest Payable -debit to meet Expense, a bit to Discount on Bonds Payable, and a credit to Cash -debit to interest Expense, credit to Discount on Bonds Pated credit to Cash