Smith Company issued $540,000 par value, 10-year, 7% bonds on February 1, 2018. The bonds are dated January 1, 2018, and pay interest quarterly each March 31, June 30, September 30, and December 31. The bonds are sold at par plus accrued interest because the bonds are sold between interest dates. Prepare the journal entries required first to issue the bonds on February 1, 2018, and second to record the first interest payment on March 31. Please list accounts on how they should be recorded.