On January 1, 2020, Larkspur Company purchased $500,000, 10% bonds of Aguirre Co. for $463,197. The bonds were purchased to yield 12% interest. Interest is payable semiannually on July 1 and January 1. The bonds mature on January 1, 2025. Larkspur Company uses the effective-interest method to amortize discount or premium. On January 1, 2022, Larkspur Company sold the bonds for $464,885 after receiving interest to meet its liquidity needs. (c) Prepare the journal entries to record the semiannual interest on (1) July 1, 2020, and (2) December 31, 2020. (d) If the fair value of Aguirre bonds is $466,885 on December 31, 2021, prepare the necessary adjusting entry. (Assume the fair value adjustment balance on December 31, 2020, is a debit of $3,664.) (e) Prepare the journal entry to record the sale of the bonds on January 1, 2022