Warner Company issued $5,000,000 of 6%, 10-year bonds on one of its interest dates for $4,318,500 to yield an effective annual rate of 8%.The effective-interest method of amortization is to be used.What amount of discount (to the nearest dollar) should be amortized for the first interest period?
A)$140,888
B)$68,150
C)$90,960
D)$45,480

Question

Quizplus · Accepted Answer

The Answer of Warner Company issued $5,000,000 of 6%, 10-year bonds on one of its interest dates for $4,318,500 to yield an effective annual rate of 8%.The effective-interest method of amortization is to be used.What amount of discount (to the nearest dollar) should be amortized for the first interest period?
A)$140,888
B)$68,150
C)$90,960
D)$45,480

Warner Company Issued $5,000,000 of 6%, 10-Year Bonds on One