On January 1 of Year 1, Congo Express Airways issued $3,600,000 of 6% bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $3,270,000 and the market rate of interest for similar bonds is 7%. The bond premium or discount is being amortized at a rate of $11,000 every six months. The company's December 31, Year 1 balance sheet should reflect total liabilities associated with the bond issue in the amount of: a) $3,908,000 b) $3,400,000 c) $3,292,000 d) $4,016,000 e) $3,184,000
On January 1 of Year 1, Congo Express Airways issued $3,600,000 of 6% bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $3,270,000 and the market rate of interest for similar bonds is 7%. The bond premium or discount is being amortized at a rate of $11,000 every six months. The company's December 31, Year 1 balance sheet should reflect total liabilities associated with the bond issue in the amount of: a) $3,908,000 b) $3,400,000 c) $3,292,000 d) $4,016,000 e) $3,184,000
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 7MC: On January 1 a company issues a $75,000 bond that pays interest semi-annually. The first interest...
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