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On January 1, 20X1, ABC issued a coupon bond. The annual coupon payments are 100...

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Accounting

On January 1, 20X1, ABC issued a coupon bond. The annual coupon payments are 100 and the bond matures on December 31, 20X3. The principal amount of the loan, which equals 1,000, is due on December 31, 20X3. The current market rate of interest is 10 percent.

How much will ABC receive on the day it issues the bond?

What is the carrying value of the liability at the end of 20X2 (after ABC has made the coupon payment for that year)?

How much interest expense will ABC recognize in 20X3?

How much cash will ABC pay to the bondholders in 20X3?

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