P$10\mathrm{.}3($LO $3,5),$ AP On October $1,2021,$ Kristal Corp. issued $$700,000,5\%,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 $31.$

Instructions

a$.$ Prepare the journal entry to record the issuance of the bonds.

b$.$ Prepare the adjusting entry to record the accrual of interest on December $31,2021.$

c$.$ Show the balance sheet presentation of bonds payable and bond interest payable on December $31,2021.$

d$.$ Prepare the journal entry to record the payment of interest on October $1,2022.$

e$.$ Prepare the adjusting entry to record the accrual of interest on December $31,2022.$

f$.$ Assume that on January $1,2023,$ Kristal pays the accrued bond interest and calls the bonds. The call price is $104.$ Record the payment of interest and redemption of the bonds.