Exercise 14-13B Effective Interest: Amortization of bond discount LO P5 Stanford issues bonds dated January 1, 2015, with a par value of $241,000. The bonds' annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 10%, and the bonds are sold for $228,764 1. What is the amount of the discount on these bonds at issuance? Discount 12,236 2. How much total bond interest expense will be recognized over the life of these bonds? Total Bond Interest Expense over Life of Bonds: Amount repaid: 6 payments of 9,640 57,840 241,000 Par value at maturity Total repaid 298,840 228,764 Less amount borrowed 70,076 Total bond interest expense