On May 1, 2021, Novak Corp. purchased $1,600,000 of 12% bonds, interest payable on January 1 and July 1, for $1,406,500 plus accrued interest. The bonds mature on January 1, 2027. Amortization is recorded when interest is received by the straight-line method. (Assume bonds are available for sale.)

1-Prepare the journal entry for May 1, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

2-The bonds are sold on August 1, 2022 for $1,412,500 plus accrued interest. Prepare all entries required to properly record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.)