Dot Company issued $200,000 of bonds on January 1,2014 with interest payable each year.The bonds had a stated rate of 8%.The bonds were set up as floating-rate debt with the rated pegged to LIBOR plus 3%.Which of the following will be the interest expense for year 1 if LIBOR is 5%?
A) $6,000
B) $10,000
C) $16,000
D) $18,000
Correct Answer:
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