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No-Toxic-Toys currently has $550,000 of equity and is planning an $220,000 expansion to meet increasing demand for its product. The company currently earns $110,000 in net income, and the expansion will yield $55,000 in additional income before any interest expense. The company has three options: (1) do not expand, (2) expand and issue $220,000 in debt that requires payments of 13% annual interest, or (3) expand and raise $220,000 from equity financing. For each option, compute (a) net income and (b) return on equity (Net Income = Equity). Ignore any income tax effects. (Round "Return on equity" to 1 decimal place.) 1 2 3 Income before interest expense Don't Expand Debt Financing Equity Financing $ 110,000 $ 165,000 $ 165,000 0 28,600 0 $ 110,000 $ 136,400 $ 165,000 Interest expense Net income Equity Return on equity % % % Tano Company issues bonds with a par value of $98,000 on January 1, 2020. The bonds' annual contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 10%, and the bonds are sold for $90,537. 1. What is the amount of the discount on these bonds at issuance? 2. How much total bond interest expense will be recognized over the life of these bonds? 3. Prepare a straight-line amortization table for these bonds. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the amount of the discount on these bonds at issuance? Discount $ 7,463 Required 1 Required 2 Required 3 How much total bond interest expense will be recognized over the life of these bonds? Total Bond Interest Expense Over Life of Bonds: Amount repaid: 6 payments of Par value at maturity Total repaid Less amount borrowed Total bond interest expense 0 $ 0 Required 1 Required 2 Required 3 Prepare a straight-line amortization table for these bonds. (Round your intermediate calculations to the nearest dollar amount.) Semiannual Period-End Unamortized Discount Carrying Value (0) 01/01/2020 (1) 06/30/2020 (2) 12/31/2020 (3) 06/30/2021 (4) 12/31/2021 (5) 06/30/2022 (6) 12/31/2022