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On January 1, 2016, Knorr Corporation issued $1,400,000 of 6%, 5-year

bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 7%. Bond issue costs associated with the bonds totaled $27,560.53.
Required:
Prepare the journal entries to record the following:
January 1, 2016 Sold the bonds at an effective rate of 7%
December 31, 2016 First interest payment using the effective interest method
December 31, 2016 Amortization of bond issue costs using the straight-line method
December 31, 2017 Second interest payment using the effective interest method
December 31, 2017 Amortization of bond issue costs using the straight-line method

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