On January 1, 2016, Whittington Stoves issued $770 million of its 6% bonds for $706 million. The bonds were priced to yield 8%. Interest is payable semiannually on June 30 and December 31. Whittington records interest at the effective rate and elected the option to report these bonds at their fair value. One million dollars of the increase in fair value was due to a change in the general (risk-free) rate of interest. On December 31, 2016, the fair value of the bonds was $722 million as determined by their market value on the NYSE. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)

1. Prepare the journal entry to record interest on June 30,2016

2. Prepare the journal entry to record intereset on December 31, 2016

3. Prepare the journal entry to adjust the bonds to their fair value for presentaation in the December 31, 2016 balance sheet