The Square Foot Grill, Inc. issued $380,000 of 10-year, 8 percent bonds on July 1, Year 1, at 102. Interest is payable in cash semiannually on June 30 and December 31. The straight-line method is used for amortization.

a. Prepare the journal entries to record issuing the bonds and any necessary journal entries for Year 1 and Year 2. Post the journal entries to T-accounts. Prepare any necessary closing entries for Year 1. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

(Select "cl" for all the closing entries.)

b. Prepare the liabilities section of the balance sheet at the end of Year 1 and Year 2. (Amounts to be deducted should be indicated with minus sign.)

c. What amount of interest expense will Square Foot report on the financial statements for Year 1 and Year 2?

d. What amount of cash will Square Foot pay for interest in Year 1 and Year 2?