On January 1, 2015, Surreal Manufacturing issued 530 bonds, each with a face value of $1,000, a stated interest rate of 3 percent paid annually on December 31, and a maturity date of December 31, 2017. On the issue date, the market interest rate was 4 percent, so the total proceeds from the bond issue were $515,294. Surreal uses the effective-interest bond amortization method and adjusts for any rounding errors when recording interest in the final year.

2-5. Complete the required journal entries to record the bond issue, interest payments on December 31, 2015 and 2016, interest and face value payment on December 31, 2017, and bond retirement. Assume the bonds are retired on January 1, 2017, at a price of 103. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your answers to the nearest whole dollar.) Answer is not complete. No Date General Journal Debit Credit January 01, Cash 515,294 Discount on Bonds Payable 14,706 Bonds Payable 530,000 December 31 2 Interest Expense 20,612 2015 4,712 15,900 Discount on Bonds Pavable Cash December 31, 2016 Interest Expense 20,800 4,900 15,900 Disc ount on Bonds Payable Cash December 31, 2017 4 Interest Expense 20,996 Discount on Bonds Payable Cash 5,096 15,900 January 01, 2017 Bonds Payable 530,000 Cash 530,000