The straight-line method is used to amortize any bond, Ask an Expert

Accounting

On January 1, 2010, Jacob issues $600,000 of 11%, 15-year bonds at a price of 102½. Six years later, on January 1, 2016, Jacob retires 30% of these bonds by buying them on the open market at 98½. All interest is accounted for and paid through December 31, 2015, the day before the purchase. The straight-line method is used to amortize any bond discount. What is the total interest expense for the life of the bond?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M949915

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