On July 1 of the current year, West Company purchased for cash, 70, $10,000 bonds of North Corporation to yield 10%. The bonds pay 9% interest, payable on a semiannual basis each July 1 and January 1, and mature in three years on July 1. The bonds are classified as AFS securities. The annual reporting period ends December 31. Assume the effective interest method of amortization of any discount or premium. Note: When answering the following questions, round each amount to the nearest whole dollar. Amortization Schedule Journal Entries and Financial Statement Presentation for Year 1 Journal Entries for Year 2 a. Prepare a bond amortization schedule for the current year and the following year using the effective interest method. Discount Market Bond Interest Amortization Amortized Cost Date Stated Interest Jul. 1, Year 1 Jan. 1, Year 2 $ $ $ Jul. 1, Year 2 $ b. Record the entry for the purchase of the bonds by West Company on July 1. Date Jul. 1, Year 1 Account Name To record purchase of bonds. Debit Credit c. Record the adjusting entries by West Company on December 31 to accrue interest revenue and adjust the investment to fair value. The fair value of the bonds at December 31 was $708,750. Date Dec. 31, Year 1 Account Name To accrue interest revenue. Dec. 31, Year 1 Debit Credit To adjust investment to fair value. d. Indicate the effects of this investment on the income statement for the year and year-end balance sheet. Ignore cash. Note: Do not use a negative sign for an account with a normal balance. Income Statement Other Revenues and Gains Interest revenue $ Balance Sheet, December 31 Assets Interest receivable Investment in AFS Securities Stockholders' Equity $ Accumulated other comprehensive income $