On April 1, year 1, Cricket Corporation issues $60 million of 12%, 10-year bonds payable at par. Interest on the bonds is payable semiannually each April 1 and October 1.

1) The amount of cash paid to bondholders for interest during year 1, is:

a) 6,6000,000

b) 5,400,000

c) 3, 600,000

d) 1,800,00

2) Interest expense on this bond issue reported in Criket's Year 1, income statement is:

a) 2,400,000

b) 4,800,000

c) 5,400,000

d) 7,200,000