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On January 1, 2012, $1,000,000, 5-Year, 10% Bonds, Are Issued

Question 135

Multiple Choice

On January 1, 2012, $1,000,000, 5-year, 10% bonds, are issued for $926,400. The market interest rate is 12%. Interest is paid semi-annually on January 1 and July 1. The discount amortized on July 1, 2012 is


A) $60,000.
B) $55,584.
C) $6,000.
D) $5,584.

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