On April 1, 2015, Eviline, Inc. issued 400 $1,000 five-year, 10% bonds at 100.

Interest is payable annually on April 1.

1. The entry to record the sale / issuance on 4.1.15 is:

2. The adjusting entry to accrue the interest on 12.31.15 is:

3. The entry to record the payment of the interest on 4.1.16 is:

4. The contract rate is 10% for these bonds. What is the market rate?