On January 1, 2014, Hummer Company purchased 5% bonds, having a maturity value of $500,000, for $428,938. The bonds provide the bondholders with a 7% yield. They are dated January 1, 2014, and mature January 1, 2024, with interest receivable June 30 and December 31 of each year. Hummer Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Instructions:

(a) Prepare the journal entry at the date of the bond purchase.

(b) Prepare the bond amortization schedule.

(c) Prepare the journal entries to record the interest received and the amortization for 2014.

(d) Assume these debt securities were instead classified as Available for Sale. The fair value of the securities at December 31, 2014 is $449,013. Prepare any adjusting journal entry as of December 31, 2014.