A corporation issued $ 200,000, 10%, 5-year bonds on January 1, 2021 for $ 216,222, which reflects an effective-interest rate of 8%. Interest is paid semi-annually on January 1 and July 1. The amount of bond interest expense to be recognized on July 1, 2021, is

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The bond interest expense is calculated using the effective interest rate method. The interest expense for the first period is the carrying amount of the bond ($216,222) multiplied by the effective interest rate per period (8% annual rate / 2 = 4% per period), which equals $8,649.

A Corporation Issued $ 200,000, 10%, 5-Year Bonds on January