On January 1, 2016, Knorr Corporation issued $900,000 of 6%, 5- year bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 7%. Bond issue costs associated with the bonds totaled $10,687.46

Prepare the journal entries to record the following

January 1, 2016: Sold the binds at an effective rate of 7% December 31, 2016: First interest payment using the effective interest method. December 31, 2016: Amortization of bond issue costs using the straight line method. December 31, 2016: Second interest payment using the effective interest method. December 31, 2017: Amortization of bond issue costs using the straight line method.