On January 1, a company issues bonds dated January 1 with a par value of $470,000. The bonds mature in 5 years. The contract rate is 11%, and interest is paid semiannually on June 30 and December 31. The market rate is 12% and the bonds are sold for $452,707. The journal entry to record the first interest payment using the effective interest method of amortization is: Multiple Choice Debit Interest Expense $24,538; debit Premium on Bonds Payable $1,312; credit Cash $25,850. Debit Interest Expense $24,538; debit Discount on Bonds Payable $1,312; credit Cash $25,850. Debit Interest Expense $27,162; credit Discount on Bonds Payable $1,312; credit Cash $25,850. Debit Interest Payable $25,850; credit Cash $25,850. Debit Interest Expense $27,162; credit Premium on Bonds Payable $1,312; credit Cash $25,850