On December 1, 20Xl, Nolanville issued $10 million of 30-year, 8 percent bonds for $9.78 million, a

Question:

On December 1, 20Xl, Nolanville issued $10 million of 30-year, 8 percent bonds for $9.78 million, a price that reflects a semiannual yield of 4 .1 percent. Interest ($400,000 per semiannual period) is payable on May 31 and November 30, beginning May 31, 20X2. In its 20Xl fund and government-wide statements, Nolanville should report an interest expenditure/ expense of