1. Didde Company issues $12,000,000 face value of bonds at 96 on January 1, 2013. The bonds are dated January 1, 2013, pay interest semiannually at 8% on June 30 and December 31, and mature in 10 years. Straight-line amortization is used for discounts and premiums. On June 30, 2016, the bonds are called Gi.e. bought back) at 102. What gain or loss would be recognized on the called bonds? A) $1,200,000 loss B) $552,000 loss C) $672,000 loss D) $907,000 loss E) None of the above 2. On January 1, 2014, Ann Price loaned $112,697.22 to Joe Kiger. A zero-interest-bearing note (face amount, $150,000) was exchanged solely for cash; no other rights or privileges were exchanged. The note is to be repaid on December 31, 2016. What amount of interest income(round to nearest dollar) should Ms. Price recognize in (hint: the answer is the same if Ann Price purchased a zero coupon bond from Joe Kiger) A) $11,270. B) $15,000. C) $45,000. D) $12,065. E) None of the above 3. On January 1, Martinez Inc. issued $5,000,000, l 1% bonds. The bonds mature in 11 years. Interest is payable annually on December 31. The issue price was $5,680,519.06 Martinez uses the effective-interest method of amortizing bond premium. At the end of ten years, Martinez should report unamortized bond premium of(nearest dollar): A) $308,551 B) $45,455 C) $ 91,743 D) $641,766 E) None of the above