McMaster Corporation issued $500,000 of 6.5% 10-year bonds. The bonds are dated and sold on January 1, 2015. Interest payment dates are January 1 and July 1. The bonds are issued for $482,234 to yield the market interest rate of 7%. On the first semiannual interest payment date, July 1, 2015, the company recorded $16,878 in interest expense and $628 in discount amortization. The interest payment is $16.250. Using the effective interest method, what is the carrying amount of the bonds on the January 1, 2016 balance sheet? O A. $482,234 OB. $482,862 OC. $500,000 OD. $483,512
The post McMaster Corporation issued $500,000 of 6.5% 10-year bonds. The bonds are dated and sold on January appeared first on Homework Gig.