Question

On January 1, 2016, Parker Company issued a three-year, $100,000, 5% bond. The interest is payable...

On January 1, 2016, Parker Company issued a three-year, $100,000, 5% bond. The interest is payable annually each December 31. The market rate of interest for companies similar to Parker is 6%. Parker uses the effective-interest amortization method.

The issue price of the bond on January 1, 2016 is closest to:

A. $97,327

B. $92,639.

C. $102,723.

D. $97,567.

Based on the same information provided above, Parker’s interest expense for December 31, 2016 is closest to:

-$5,839.

-$5,257.

-$5,887.

-$5,000.

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Answer #2

answer :

1) Issue Price = A) $97,327

2) interest Expenses = $ 5,839.

answered by: anonymous
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