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On 1 July 2022, RED Ltd issued $1 million in 10-year bonds that pay interest every six months at a coupon rate of 10%. At

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On 1 July 2022, RED Ltd issued $1 million in 10-year bonds that pay interest every six months at a coupon rate of 10%. At the time of issuing the securities, the market requires a rate of return 12%. Interest expense is determined using the effective-interest method.

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