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On January 1, 2016, Parker Company issued a three-year, $100,000, 5% bond. The interest is payable annually each December 31. The market rate of interest
On January 1, 2016, Parker Company issued a three-year, $100,000, 5% bond. The interest is payable annually each December 31. The market rate of interest for companies similar to Parker is 6%. Parker uses the effective-interest amortization method. The issue price of the bond on January 1, 2016 is closest to:
A. $97,327
B. $92,639.
C. $102,723.
D. $97,567.
Based on the same information provided above, Parkers interest expense for December 31, 2016 is closest to:
-$5,839.
-$5,257.
-$5,887.
-$5,000.
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