Exercise 10-9 Your answer is partially correct. Try again. On January 1, 2019, Klosterman Company issued $500,000, 10%, 10-year bonds at face value. Interest is payable annually on January 1 Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1 Cash 500000 Bonds Payable 500000 Prepare the journal entry to record the accrual of interest on December 31, 2019. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31 Interest Expense 25000 Interest Payable 25000