On January 1, Year 1 Residence Company issued bonds with a $50,000 face value. The bonds were issued at 96 resulting in a 4% discount. They had a 20 year term and a stated rate of interest of 7%payable in cash on December 31 of each year. The effective rate of interest was 7.389%. Assuming Residence uses the effective interest rate method, the journal entry necessary to recognize interest expense on the December 31, Year 1 is