Jenks Co. partially refunded $180,000 of its outstanding 10% note payable, made 1 year ago to Arma State Bank by paying $180,000 plus $18,000 interest (having obtained the $198,000 by using $52,400 cash and signing a new 1-year $160,000 note discounted at 9% by the bank).
(1) Make the entry to record the partial refunding. Assume Jenks Co. makes reversing entries when appropriate.
(2) Prepare the adjusting entry at December 31, assuming straight-line amortization of the discount