On january 1 2012 huber co. sold 12 bonds with a face value, Ask an Expert

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On January 1, 2012, Huber Co. sold 12% bonds with a face value of $800,000. The bonds mature in five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $861,600 to yield 10%. Using the effective-interest method of amortization, interest expense for 2012 is

A) $96,000.

B) $86,160.

C) $80,000.

D) $85,914.

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