On January 1,2010,Jacob Issues $800,000 of 9%,13-Year Bonds at a Price

On January 1,2010,Jacob issues $800,000 of 9%,13-year bonds at a price of 96½.Six years later,on January 1,2016,Jacob retires 20% of these bonds by buying them on the open market at 105½.All interest is accounted for and paid through December 31,2015,the day before the purchase.The straight-line method is used to amortize any bond discount. What is the journal entry to record the first interest payment on June 30,2010?

A)
$\begin{array}{|c|c|c|}\hline \text { Interest Expense } & 36,000 & \\\hline \text { Cash } & & 36,000 \\\hline\end{array}$

B)
$\begin{array}{|c|r|r|}\hline \text { Cash } & 36,000 & \\\hline \text { Interest Expense } & & 36,000 \\\hline\end{array}$

C)
$$\begin{array} { | l | r | r | } \hline \text { Interest Expense } & 36,000 & \\\hline \text { Discount on Bonds Payable } & 1,077 & \\\hline \text { Cash } & & 37,077 \\\hline\end{array}$$
D)
$$\begin{array} { | l | r | r | } \hline \text { Interest Expense } & 36,000 & \\\hline \text { Premium on Bonds Payable } & 1,077 & \\\hline \text { Cash } & & 37,077 \\\hline\end{array}$$
E)
$$\begin{array} { | l | r | r | } \hline \text { Interest Expense } & 37,077 & \\\hline \text { Discount on Bonds Payable } & & 1,077 \\\hline \text { Cash } & & 36,000 \\\hline\end{array}$$