The following section is taken from Hardesty's balance sheet at December 31, 2016.

Current Liabilities

Interest Payable $45,000

Long term liabilities

Bonds payable (8%, due Jan. 1, 2020) 550,000

Interest is payable annually on January 1. The bonds are callable on any annual interest date.

(a) Journalize the payment of the bond interest on January 1, 2017.

(b) Assume that on Jan. 1 2017, after paying interest, Hardesty calls bonds having a face value of 145,000. The call price is 110. Record the redemption of the bonds.

(c) Prepare the adjusting entry on December 31, 2017, to accrue the interest on the remaining bonds.

No.	Date	Account Titles & Explanation	Debit	Credit
(a)	Jan. 1
(b)	Jan. 1
(c)	Dec. 31