NoleCo issues bonds on January $1,2023.$ These bonds pay interest semi$-$annually on June $30$and December $31$each year. The face value of the bonds is $$1,000,000$and the coupon$/$stated rate is $8\%.$The market rate on the issue date is $10\%.$The bonds were issued for $$850,000.$ Show work.

$$The interest expense that NoleCo should recognize on June $30,2023$is:

$$40,000$

$$34,000$

$$42,500$

$$50,000$

The carrying value of these bonds on December $31,2023($after the interest payment on that date$)$is:

$$1,000,000$

$$850,000$

$$855,000$

$$855,125$

$844,875$

The interest expense that NoleCo should recognize on December $31,2023$is:

$$40,000$

$$42,500$

$$42,625$

$$42,375$