Question 3 Partially correct Mark 20.00 out of 31.00 Flag question Edit question Recording Bond Entries and Preparing an Amortization Schedule-Effective Interest Method, Discount Mitchell Inc. issued 40,6%, $1,000 bonds on January 1, 2020, for $38,950. The bonds pay cash interest annually each December 31 and were issued to yield 7%. The bonds mature December 31, 2022, and the company uses the effective interest method to amortize bond discounts or premiums. Required a. Prepare an amortization schedule for the full bond term. Note: Round amounts in schedule to the nearest whole dollar. Use rounded amounts for later calculations in the schedule. Effective Interest Method-Discount Date Cash Interest Expense Discount Amortization Bonds Payable, Net Jan. 1, 2020 $ 38,950 Dec. 31, 2020 $ 2,400 $ 1,340 $ 0 X 0 x Dec. 31, 2021 2,400 0 x OX 0 x Dec. 31, 2022 2,400 OX 0 x 0 x b. Prepare journal entries on the following dates. 1. January 1, 2020, bond issuance. 2. December 31, 2020, interest payment. Note: List multiple debits or credits (when applicable) in alphabetical order. Note: Round your answers to the nearest whole dollar. Dr. Cr. 38,950 0 1,050 0 Date Account Name 1. Jan. 1, 2020 Cash Discount on Bonds Payable Bonds Payable 2. Dec. 31, 2020 Interest Expense Cash Discount on Bonds Payable 0 40,000 0 x 0 2,400 1,050 * 0