Suppose Southern Airlines issued $150,000 of 12%, five-year bonds when the market interest rate is 14%. The market price of the bonds drops, and Southwest receives $139,416 when the bonds are issued. The transaction was recorded as follows: (Click the icon to view the transaction.) Southern's journal entries to record interest expense and amortize the bond discount in the first year follows: - X Transaction (Click the icon to view the journal entries.) At December 31, 2021, Southern's bond accounts appear as follows: (Click the icon to view the accounts.) Journal Entry What would Southern Airlines' 2021 income statement and year-end balance sheet report for these bonds? Date Accounts and Explanation Debit Credit 2021 Cash 139,416 Jan 1 Discount on Bonds Payable 10,584 Begin by completing the income statement for 2021. Bonds Payable 150,000 Income Statement for 2021 To issue bonds at a discount - X Journal entries - X Accounts Debit Credit 9.759 759 Bonds Payable 9,000 Journal Entry Date Accounts and Explanation 2021 Interest Expense Jul 1 Discount on Bonds Payable Cash To pay semiannual interest and amortize bond discount Dec 31 Interest Expense Discount on Bonds Payable Interest Payable To accrue semiannual interest and amortize bond discount. 150,000 Discount on Bonds Payable 10,584 759 812 9.812 Bal 9,013 812 9.000 Bond carrying amount, $140,987 = $150,000 - $9,013. Print Done Print Done