Rabbit Corp. issued 7% five-year bonds payable with a face amount of $40,000 when the market interest rate was 7%. Rabbit's fiscal year-end on December 31. The bonds pay interest on January 1 and July 1. Read the tequiremen Journal Entry Date Accounts and Explanations Debit Credit 2018 Cash 40,000 Jul 1 Bonds Payable 40,000 To issue bonds at par b. Accrual of interest expense on December 31, 2018 Journal Entry Date Accounts and Explanations Debit Credit 2018 Interest Expense 2800 Dec 31 Interest Payable 2800 To accrue interest.