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2. Loan 2 is an 8%,$1,000,000 loan with interest due annually on December 31 . Drake did not record or pay the required Year 2 interest payment until January 1, Year 3. Prepare the journal entry Drake should record at December 31, Year 2. Scroll down to complete all parts of this task. Drake, Inc., has two loans recorded on its books. Loan 1 was obtained on January 1, Year 1, and Loan 2 was entered into on January 1, Year 2. Drake's year end is December 31. For the situations related to the loans below, prepare the appropriate journal entries. Each loan should be accounted for independent of the other loan. To prepare each required journal entry: - Click on a cell in the Account Name column and select from the option list the appropriate account. Each choice may be used once or not at all. - Enter the corresponding debit or credit amount in the associated column. - Enter all amounts as positive values. Round all amounts to the nearest whole number. - Not all rows in the table might be needed to complete each journal entry. - If no journal entry is needed, check the "No entry required" box at the top of the table as your response. 1. Loan 1 is a 4%,5-year balloon loan for $3,000,000 with interest due and paid annually on December 31. Drake records interest annually on December 31. Drake incorrectly recorded the journal entry for the Year 1 interest expense and payment as a debit to accrued interest payable and a credit to cash. Prepare the net journal entry to correct Year 1 and properly record the interest attributable to the loan as of and for the year ended December 31, Year 2