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On January 1, 2013, Solo Inc. issued 1,600 of its 7%, $1,000 bonds at 99. Interest is payable semiannually on January 1 and July 1.

On January 1, 2013, Solo Inc. issued 1,600 of its 7%, $1,000 bonds at 99. Interest is payable semiannually on January 1 and July 1. The bonds mature on January 1, 2023. Solo paid $67,000 in bond issue costs. Solo uses straight-line amortization. The amount of interest expense for the year is:

$120,300
$121,900
$112,000
$113,600

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