Acme Corp. is in need of cash. It issues bonds with a $8,500,000 face value. The bonds have a 7.60% coupon rate. The market rate is 10%. The bonds have a life of 5 years, and are compounded semiannually. Acme Corp. issues the bonds on 1/1/2022. You may round your answers to the nearest dollar.

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What is the journal entry at Acme Corp. will record on 12/31/22?

Question 12 options:

	Dr. Interest Expense $385,618 Cr. Discount $62,618 Cr. Cash $323,000
	Dr. Interest Revenue $385,618 Cr. Discount $62,618 Cr. Cash $323,000
	N/A; No journal entry is required.
	Dr. Interest Expense $388,749 Cr. Discount $65,749 Cr. Cash $323,000
	Dr. Interest Expense $385,618 Cr. Premium $62,618 Cr. Cash $323,000

Question 13 (2 points)

Acme Corp. is in need of cash. It issues bonds with a $8,500,000 face value. The bonds have a 7.60% coupon rate. The market rate is 10%. The bonds have a life of 5 years, and are compounded semiannually. Acme Corp. issues the bonds on 1/1/2022. You may round your answers to the nearest dollar.

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What is the journal entry Acme Corp. will record when it retires the bonds in 5 years (after/not including the final coupon payment):

Question 13 options:

	Dr. Bonds Payable $8,500,000 Cr. Premium $787,646 Cr. Cash $7,712,354
	N/A; No journal entry is required.
	Dr. Bonds Payable $8,500,000 Cr. Discount $787,646 Cr. Cash $7,712,354
	Dr. Bonds Payable $8,500,000 Cr. Cash $8,500,000
	Dr. Bonds Payable $7,712,354 Cr. Cash $7,712,354

Question 14 (2 points)

Acme Corp. is in need of cash. It issues bonds with a $8,500,000 face value. The bonds have a 7.60% coupon rate. The market rate is 10%. The bonds have a life of 5 years, and are compounded semiannually. Acme Corp. issues the bonds on 1/1/2022. You may round your answers to the nearest dollar.

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Over the life of the bond, how much interest expense will Acme Corp. recognize?

Question 14 options:

	$4,250.000
	$850,000
	$4,017,646
	$3,230,000

Question 15 (2 points)

Acme Corp. is in need of cash. It issues bonds with a $8,500,000 face value. The bonds have a 7.60% coupon rate. The market rate is 10%. The bonds have a life of 5 years, and are compounded semiannually. Acme Corp. issues the bonds on 1/1/2022. You may round your answers to the nearest dollar.

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If the coupon rate was 10% (instead of 7.60%) and all other facts remained the same, what would be the price of the bond at issuance?

Question 15 options:

	$7,712,354
	$7,250,000
	$7,650,000
	$8,500,000