On January 1, firm issued $500,000 of 15 year, 6 percent bonds payable for $552,325, yielding an effective rate of 5 percent. Interest is payable on June 30 and December 31 each year. The firm records amortization on each interest date. Bond interest expense for the first six months, using effective interest amortization, is: Select one: A. $15,000 B. $13,808 C. $14,059 D. $16,587
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A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
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A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Bond interest expense for the first six months, using effective interest amortization, is:
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