On January 1, 2021, Indebt.com issued 5 year, $300,000 Bonds Payable at a contract or stated rate of 7%. The bonds provide a market rate of return of 8%. Interest is paid annually on January 1 of each year.

Indebt.com has the following partial amortization schedule for these bonds.

Date	Interest Paid 7%	Interest Expense Effective Rate 8%	Discount Amortized	Discount Balance	Carrying Value $300,000 - Discount Balance
1/1/2021	at issue date			11,979	288,021
12/31/21	21,000	23,042	2,042	9,937	290,063
12/31/22	21,000	23,205	2,205	7,732	292,268
12/31/23	21,000	23,381	2,381	5,351	294,649
12/31/24	21,000	23,572	2,572	2,779	297,221
12/31/25	21,000	23,778	2,779 *	0	300,000

*rounded

Instructions: Provide the following: (round answers to the nearest dollar, use the attached General Journal)

1. 1.The issuance of the bonds on January 1.
2. 2.The adjusting journal entry required on December 31, 2021, for the accrual of interest and any associated bond amortization.
3. 3.The entry on January 1, 2022, for the interest payment.
4. 4.The adjusting journal entry required on December 31, 2022, for the accrual of interest and any associated bond amortization

In addition, determine the total amount of interest expense that the company will recognize and charge to the income statement over the 5-year life of the bonds

Answer:____________________________________________________

General Journal

Date		Account Titles and Explanation	PR	Debit	Credit