Company issued $4,000,000, 5-year, 12% bonds for $4,280,000 with semi annual interest payable on March 31 and September 30. If the effective rate of interest is 10 %, determine following:
Part 1. The interest rate paid on September 30 is ____
A. $ 150,000 B. $ 100,000 C. $ 140,000 D. $ 240,000

2. The amount of premium amortized on September 30, using straight line method is _____.

A. $ 30,000 B. $ 28,000 C. $ 24,000 D. $ 2, 400


Part 3. The accrued interest payable on December 31 is ___________-

A. $ 0 B. $ 150,000 C. $ 120,000 D. $ 100,000

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