On June 1,2015,Smith & Beecham Services issued $36,000 of 8% bonds that mature in five years for $45,000.The bonds pay semiannual interest payments on June 30 and December 31 of each year.On December 31,2015,what is the total interest paid to bondholders?

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Quizplus · Accepted Answer

The bonds have a face value of $36,000 with an 8% annual interest rate. The semiannual interest payment is calculated as $36,000 * 8% / 2 = $1,440. Since the question asks for the total interest paid by December 31, 2015, only one semiannual payment has been made by that date, which is $1,440.

On June 1,2015,Smith & Beecham Services Issued $36,000 of 8