On July 1 of the current year, West Company purchased for cash, 14, $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 held to maturity 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 answers to the nearest whole dollar, a. Prepare a bond arnortization schedule for the current year and the following year using the effective interest method. Date Stated Interest Jul. 1, Year 1 Jan. 1. Year 2 $ Jul. 1 Year 2 Market Discount Bond Interest Amortization Amortized Cost $ 136,447 6,822 S 522 136,969 6,848 548 137,517 6,300 $ 6,300 b. Record the entry for the purchase of the bonds by West Company on July 1. Debit Credit 0 Date Account Name Jul. 1, Year 1 Investment in HTM Securities Cash To record investment purchase 136,447 0 136,447 c. Record the adjusting entry by West Company on December 31. The fair value of the bonds at December 31 was $141,750. Debit Credit . Date Account Name Dec. 31, Year 1 Interest Receivable Investment in HTM Securities Interest Revenue To record year end adjusting entry 6,300 522 0 0 0 6,822 + Income Statement Year 1 Other Revenues and Gains Interest revenue S 17.190 X Balance Sheet Dec. 31, Year 1 Assets Interest receivable S 17,190 x Investment in HTM Securities S 17,190 X e. Record the receipt of interest on January 1 of the following year ( Year 2) Debit Credit + Date Account Name Jan, 1. Year 2 Cash Interest Receivable To record interest received 6,300 0 0 6.300 + f. After the interest payment on July 1, Year 2, two of the bonds were sold for $18,335 cash. Provide the required entries on that date. Debit Credit 0 + 0 X 0 OX OX + 0 Date Account Name Jul. 1. Year 2 Cash Gain on Sale of Investment Interest Revenue To record interest received. Jul, 1. Year 2 Cash Gain on Sale of Investment Interest Revenue To record sale of bonu. + + + 0 0 0 X OX 0 X 0