Brief Exercise 14-7 Straight-line interest on bonds [LO14-2] On January 1, a com

Question

Brief Exercise 14-7 Straight-line interest on bonds [LO14-2]

On January 1, a company issued 3%, 20-year bonds with a face amount of $80 million for $69,033,776 to yield 4%. Interest is paid semiannually. What was the straight-line interest expense on the December 31 annual income statement? (Enter your answers in whole dollars. Round your intermediate calculations to the nearest dollar amount.)

On January 1, a company issued 3%, 20-year bonds with a face amount of $80 million for $69,033,776 to yield 4%. Interest is paid semiannually. What was the straight-line interest expense on the December 31 annual income statement? (Enter your answers in whole dollars. Round your intermediate calculations to the nearest dollar amount.)

Explanation / Answer

Interest expense for the year: $1,474,156 + 1,474,156 = $2,948,312

$80,000,000

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