On $7/1/21,$ ABC sold $10\%$ bonds having a maturity value of $$1,000,000$ for $$1,081,105,$ resulting in an effective yield of $8\%.$ The bonds are dated $7/1/21,$ and mature $7/1/26.$ Interest is payable semiannually on July $1$ and January $1.$ ABC uses the effective interest method of amortization for bond premium or discount. Record the adjusting entry for the accrual of interest and the related amortization on $12/31/21.$ Hint: Develop an abbreviated amortization schedule to accurately determine the interest expense. premium carrying

date cash$(5\%)$ interest$(4\%)$ amort value

$7/1/20218,110\mathrm{.}501,081,105\mathrm{.}00$

$1/1/2022$

$7/1/2022$

$1/1/2023$

$7/1/2023$

$1/1/2024$

$6/30/2024$

$12/31/2024$

$6/30/2025$

$12/31/2025$

$7/1/2026$