unwinding the discount/debtor ledger

I will try to illustrate with example based on bills issued at par $1 Million to be settled at $1210000 in two years time. The implicit rate of interest is ten percent. This will involve on issue recognising debit to bank of $1 million and recognition of liability of $1million. After one year profit and loss should be debited by $100000 (0.1 X $1 million). Simultaneously liability for settlement of bill is credited by $100000. This follows accruals principle. The next year profit and loss should be debited by $110000($1100000 X 0.1). At same time liability should be credited by same amount leading to liability of $1210000. When bills are paid debit liability $1210000 and credit bank $121000. This extinguishes liability. The process above shows how discounted liability is initially recognised and then unwound as payment date gets closer.