On July 1, 2019 Henry Company issued $4,000,000 of 5%, 10 year bonds, payable each June 30 and December 31. The bonds were issued to yield 6%. The company uses the effective-interest rate method to amortize discounts and premiums. Due to a change in general interest rates, the company was able to purchase and retire, bonds with a face value of $1,200,000 at 84 on July 1, 2022. This purchase took place after the June 30 interest payment was made and recorded. Required: 1. Give the entry to recognize the retirement of the bonds on July 1, 2022. 2. Assume that the company wishes to defease the remaining bonds. What critical element of a defeasance must be in place to allow this transaction to be recorded with derecognition? Contrast this with an in-substance defeasance