$*$P$11\mathrm{.}5($LO $2,5)$ On January $1,2025,$ Lock Industries Ltd$.$ issued $1,800,000$ face value, $5\%,10-$year bonds at $1,667,518.$ This price resulted in an effective$-$interest rate of $6\%$ on the bonds. Lock uses the effective$-$interest method to amortize bond premium or discount. The bonds pay annual interest January $1.$

Instructions

$($Round all computations to the nearest pound.$)$

a$.$ Prepare the journal entry to record the issuance of the bonds on January $1,2025.$

b$.$ Prepare an amortization table through December $31,2027(3$ interest periods$),$ for this bond issue.

c$.$ Prepare the journal entry to record the accrual of interest and the amortization of the discount on December $31,2025.$

c$.$ Interest Expense $100,051$

d$.$ Prepare the journal entry to record the payment of interest on January $1,2026.$

e$.$ Prepare the journal entry to record the accrual of interest and the amortization of the discount on December $31,2026.$

Prepare journal entries to record issuance of bonds, payment of interest, and effective$-$interest amortization, and statement of inancial position presentation.