1.The Evermaster Co. issues at par a $100,000 8% bond on Jan. 1, 2010 which matures after 5 years. Bond issue costs are $7721.73 . The bond pays interest on July 1 and Jan 1. A

A. How much interest expense will be recognized under IFRS on July 1, 2010 ? (round to the nearest dollar, use effective interest method.)

B. How much interest expense will be recognized under GAAP for the six month period ending July 1, 2013.

C. How much interest expense will be recognized under IFRS for the six month period ending July 1, 2013 ( Hint: You need to compute the book value at the beginning of the six month period.) Round your answer to the nearest dollar?

2.On January 1, 2013 the Mack Company issues $16,000,000 of 11% bonds dated January 1. Interest is payable semiannually on June 30 and December 31. The bonds mature in 4 years. The issue price of the bonds was $16,517,057.02 with no bond issue cost.

A. Using the effective interest method, how much interest expense should be recognized for the period ending June 30, 2013?

B. Compute interest expense for the semi-annual period ending December 31, 2015.

C.Suppose that instead of the effective interest method, the straight line method was used. How much interest expense would be recognized in each period?