On January 1,2017,Citywide Sales issued $25,000 in bonds for $29,800.These are eight-year bonds with a stated rate of 15% and pay semiannual interest.Citywide Sales uses the straight-line method to amortize the bond premium.On June 30,2017,when Citywide makes the first payment to bondholders,what is the amount that will be reported as Interest Expense?
A) $1,575
B) $1,875
C) $3,225
D) $1,225
Correct Answer:
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