On October 1, 2021, Martinez Corp. issued $816,000, 8%, 10-year bonds at face value. The bonds were dated October 1, 2021, and pay interest annually on October 1. Financial statements are prepared annually on December 31.

Part 1 Your answer is correct. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Oct. 1, 2021 Cash 816,000 Bonds Payable 816,000 eTextbook and Media List of Accounts Part 2 Your answer is correct. Prepare the adjusting entry to record the accrual of interest on December 31, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 Interest Expense 16320 Interest Payable 16320 Part 3 . Your answer is partially correct. Show the balance sheet presentation of bonds payable and bond interest payable on December 31, 2021. MARTINEZ CORP. Balance Sheet (Partial) December 31, 2021 Current Assets Cash Part 4 Prepare the journal entry to record the payment of interest on October 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Oct. 1, 2022 Part 5 Prepare the adjusting entry to record the accrual of interest on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2022 Part 6 Assume that on January 1, 2023, Martinez pays the accrued bond interest and calls the bonds. The call price is 105. Record the payment of interest and redemption of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1, 2023 (To record payment of interest) Jan. 1, 2023 (To record the redemption of the bonds)