Measure ingredients into bread machine in the order recommended by the manufacturer. Select Dough Cycle.
When done, remove dough to a lightly floured surface; cover with a large bowl and let rest for 10 to 15 minutes.
Shape the dough into a round cylinder about a foot long.
Cut into 8 portions 1 1/2 inches (4 cm) wide. Push thumbs through the center of each piece and pull into a bagel shape, rounding all the surfaces.
Place dough on prepared baking sheet; cover and let rise in a warm, draft-free place for 30 to 45 minutes or until doubled in volume.
Bring a large pot of water and 1 tbsp sugar to a gentle yet full boil.
Immerse bagels in water one at a time, turning upside down. Hold under the water for 20 seconds with a skimmer or large spoon until the dough becomes a little puffy.
Bake on slightly greased baking sheet in preheated 400 degree oven for 15 minutes or until the bagels sound hollow when tapped on the bottom.
Before baking, you can brush the tops with egg white for crispier outer layer.