On January 1, 2020, Vaughn Company purchased $270,000, 6% bonds of Aguirre Co. for $248,099. The bands were purchased to yield 8% interest. Interest is payable semiannually on July 1 and January 1. The bonds mature on January 1, 2025. Vaughn Company uses the effective-interest method to amortize discount or premium. On January 1, 2022, Vaughn Company sold the bonds for $249,638 after receiving interest to meet its liquidity needs. (a) Your answer is correct. Prepare the journal entry to record the purchase of bonds on January 1. Assume that the bonds are classified as available-for-s (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Jan. 1, 2020 Debt Investments Cash Debit 248099 Credit 248099