On March 1, 2015, Dorricks Ltd. borrowed $500,000, issuing a five-

year mortgage bond. No principal payments are due until the end of

the five-year loan period, but interest, at a nominal annual rate of

4%, is to be paid every six months beginning September 1, 2015.

The company's year-end is December 31.

Required

(a) Using T-accounts, record the 2015 transactions related to the

mortgage bond.

(b) Show the relevant sections of the balance sheet and income

statement in the December 31, 2015, financial statements.