In 2012,Park Company issued $200,000 of bonds for $189,640.If the face rate of interest was 8% and the effective rate of interest was 6.73%,how would Park calculate the interest expense for the first year on the bonds using the effective interest method?
A) $189,640 x 6.73%
B) $189,640 x 8%
C) $10,000 x 6.73%
D) $10,000 x 8%
Correct Answer:
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