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A company issued $220,000 5-year, 7.50% bonds and received $222,505 in cash. The market rate...

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Question

Accounting

A company issued $220,000 5-year, 7.50% bonds and received $222,505 in cash. The market rate of interest when the bonds were issued was 7.00%. What is the amount of interest expense to be recorded for the first annual interest period if the company uses simplified effective-interest amortization?

Multiple Choice

  • $16,500.00

  • $16,687.88

  • $15,575.35

  • $15,400.00

Answer & Explanation Solved by verified expert
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