Allan Corporation issued 300,8%,10-year,$1,000 bonds on Jan.1.The annual bond interest date is June 30,and the bonds were issued at face value.The amount of interest expense reported for the current year is:

Question

Quizplus · Accepted Answer

The interest expense for the year is calculated as the face value of the bonds multiplied by the interest rate. Therefore, 300 bonds x $1,000 x 8% = $24,000.

Allan Corporation Issued 300,8%,10-Year,$1,000 Bonds on Jan