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On January 1, 2009, Enron Corporation Issued a 4-Year, 7

Question 63

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On January 1, 2009, Enron Corporation issued a 4-year, 7%, $9,000 bond payable. Beginning in 2010, interest is payable annually every January 1. The market rate of interest at issuance is 9%. How much are the interest payments by Enron? Why is the amount of interest expense different than the cash payments?

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7% x $9,000 = $630 per year for 4 years
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