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Auerbach Inc. issued 8 % bonds on October 1, 2018. The bonds have a maturity date of September 30, 2028 and a face value of
Auerbach Inc. issued 8 % bonds on October 1, 2018. The bonds have a maturity date of September 30, 2028 and a face value of $450 million. The bonds pay interest each March 31 and September 30, beginning March 31, 2019. The effective interest rate established by the market was 10%. Assuming that Auerbach issued the bonds for $393,920,280, what interest expense would it recognize in its 2018 income statement? (Do not round intermediate calculations and round final answer to nearest whole dollar.) Multiple Choice $19,696,014. $0. $11,250,000. $9,848,007
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