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Discount-Mart issues $10 million in bonds on January...

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Accounting

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Discount-Mart issues $10 million in bonds on January 1, 2021. The bonds have a ten-year term and pay interest semiannually on June 30 and December 31 each year. Below is a partial bond amortization schedule for the bonds: Increase in Carrying Value Carrying Value Interest Expense Date Cash Paid $ 8,640,967 01/01/2021 $ 345,639 8,686,606 $ 45,639 06/30/2021 $ 300,000 347,464 300,000 47,464 8,734,070 12/31/2021 300,000 06/30/2022 349,363 49,363 8,783,433 351,337 300,000 51,337 8,834,770 12/31/2022 What is the annual market rate of interest on the bonds? O 3% O 6% 04% 0 7% O 8%

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