Chello Inc issued $200,000,6%,10-year bonds,with interest payable semiannually.The market rate on the issue date was 5.5%.Chello received $207,614 in proceeds.Which statement best describes Chello' responsibility to the bondholders?

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Chello Inc is obligated to repay the principal amount of $200,000 at maturity and make 20 semiannual interest payments of $6,000 each, based on the 6% annual interest rate on a $200,000 bond.

Chello Inc Issued $200,000,6%,10-Year Bonds,with Interest Payable Semiannually