On January 1, 2019, Denver Corporation issued 10-year, 4% bond with a maturity value of $260,000. The bonds sells at 94.00 and pay interest on July 1 and January 1. Denver Corporation amortizes the bond using the effective interest rate method. The market rate is 5%.

Required

Prepare the journal entries to record the sale of the bond, the interest expense for July 1 and the interest accrual for December 31 (company has a year end of December 31). Explanations are not required.