1. The interest charged on a $55000, 60-day note payable, at the rate of 6%, would be (Hint: Use 360 days for calculation)

$3300.

$825.

$1833.

$550.

2.

A $611000 bond was retired at 96 when the carrying value of the bond was $601000. The entry to record the retirement would include a

gain on bond redemption of $10000.

loss on bond redemption of $14440.

gain on bond redemption of $14440.

loss on bond redemption of $10000.

3. Crane Company issued $450000 of 6%, 10-year bonds on its interest date for $381850 to yield an effective annual rate of 8%. The effective-interest method of amortization is to be used. Interest is paid annually. What amount of discount (to the nearest dollar) should be amortized for the first interest period?

$7096

$5452

$4089

$3548